Aviation insurance costs are rising fast for airlines. Deepak Kumar, Head of Aviation and Aerospace at Tata AIG General Insurance, confirms this trend. Insurers are now demanding much stricter terms. This follows global incidents and past events like the 2010 Air India Express crash.
The global aviation insurance market faces tough times. Many losses have made insurers wary. This means airlines pay more for coverage. They also get stricter conditions.
Mr. Kumar noted that premiums were already increasing. Now, the rules are tightening even more. Airlines must share lots of specific information.
Insurers want detailed data. They check flight operations carefully. Maintenance records are important. Pilot training and claims history are also reviewed. This includes information from aviation regulators like the DGCA.
Airlines should expect more inspections. Audits will be more common. Underwriters are very careful. They pick clients very strictly now.
Some smaller airlines might struggle. They could find insurance harder to get. Their costs might go up even more.
Tougher Rules for Aviation Insurance
Recent premium hikes show this change. Rates increased by 10-15% in the third quarter of last fiscal year. Some aviation businesses saw jumps of 20-25%.
This trend will likely continue into the next fiscal year. Geopolitical risks also play a part. Events like the Ukraine war affect insurance prices. War risk premiums have climbed.
Cyber security is another big worry. Airlines handle huge amounts of data. Protecting this data is critical. Cyber attacks can be very costly.
Insurers are looking for perfect safety records. They want proof of strong risk management. The global airline industry faces many challenges. High insurance costs add to these pressures.
Airlines must show top-notch safety measures. This is key for getting good insurance deals. Without clear data, renewals become harder. Costs keep climbing.
India’s Growing Skies Face New Risks
India’s aviation sector is booming. The country expects 200 million air travelers by the end of the current fiscal year. This is a massive leap.
More airports are also planned. India has 149 airports today. The goal is to reach 220 airports by 2030. This growth will bring more flights.
More flights mean more passengers. This also creates new safety challenges. Insurers must adapt to these new risks. They need to offer suitable products.
Deepak Kumar believes India’s aviation market is robust. It shows a 15% Compound Annual Growth Rate. This means steady, strong growth.
Tata AIG sees new chances here. They plan to develop new insurance products. These products will meet the evolving needs of the sector.
India’s government highlights increasing air traffic. This growth fuels demand for more flights. It also boosts the need for better insurance solutions.
In short, airlines must be ready. Insurance costs are up. Terms are tougher. Safety data is more important than ever. This is the new normal for aviation insurance.
