The aviation industry continues to defy expectations with claims and premiums for airline insurance lower in 2012 than in 2011, according to a new report.
Aon Risk Solutions’ Aviation Market Update, shows that lead hull and liability premiums were US $1.61 billion in 2012, down from US $1.81 billion in 2011.
Major losses in 2012 totalled US$324 million, nearly 40% less than the US$522 million recorded in 2011. Adding an estimate for minor losses, the overall estimated incurred claims total was US$924 million down 20% against the US$1.13 billion total claims in 2011.
The report also highlights that regional risk exposures are now showing an underwriting profit on a five year basis as a result of the different economic recovery rates. Latin America and the Middle East are all recording strong growth while in Europe and North America risk exposures remain flat.
Simon Knechtli, chairman of Aon Risk Solutions' aviation team, said “The airline industry is to be congratulated on the reward for its considerable investment and rigour in all matters of safety and quality of operations. As a result of this investment, the outlook for airline insurance purchase in 2013 is very positive. Simple market dynamics should dictate that the underlying cost of risk will fall, particularly where losses are benign."
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