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Indian Express
22-06-2025
- Business
- Indian Express
Air India Dreamliner crash: Five ways families can claim compensation
The crash of Air India's Dreamliner on June 12 has brought renewed attention to the compensation available to the families of those who lost their lives. There are at least five avenues through which compensation can be claimed. Among them, compensation provided by Air India through its insurance coverage is mandatory. Additionally, the Tata Group has announced an ex-gratia payment of Rs one crore to the next of kin of each victim. In addition, there are three other potential sources of compensation—travel insurance, life insurance, and debit card insurance—available to the victims' families, provided the deceased had active policies under these covers. The crash is likely to result in claims of around Rs 4,000 crore ($ 470 million), making it one of the largest insurance claims involving a plane accident, with suits for claims likely to be lodged in foreign jurisdictions as several foreign nationals died in the accident, insurance sources said. It's estimated that hull will cost around $ 80 million and engine $ 45 million for insurers and reinsurers. While total liability insurance claims for people died in the crash are likely to touch $ 350 million, the final amount can vary depending on the claims lodged and the jurisdiction involved. Air India compensation from insurers: As per the Montreal Convention treaty, Air India will have to pay a minimum compensation of around Rs 1.50 crore each to the kin of victims of the plane crash. Air India will get adequate compensation for the lost aircraft from insurance companies. While interim compensation may be announced by the airline, final compensation for passengers will be determined under the Montreal Convention of 1999, to which India became a signatory in 2009. Compensation is calculated using Special Drawing Rights (SDRs), which stood at 128,821 SDRs (approximately USD 1.33 per SDR) as of October 2024. The actual payout will depend on the nature of claims and jurisdiction involved. Insurance sources said families can lodge claims in one of the several favourable jurisdictions like the carrier's domicile, place of ticket purchase and principal residence of the victim. It's learnt that the payout can change if Boeing or Air India was at fault. Sources don't rule out suits in other countries as nationals from Britain, Canada and Portugal died in the crash. Tata group compensation: In addition to the Air India insurance cover, the Tata Group will provide Rs 1 crore each to the families of the deceased in the crash of Air India's Boeing 787-8 Dreamliner in Ahmedabad. According to the Tata group, families of those who died on the ground will be eligible for the Rs 1 crore compensation and the medical expenses of those who suffered injuries would also be covered by the company, while ensuring necessary care and support. Among those feared dead and sustained injuries in ground impact are doctors, students, hospital staff and residents from the Meghaninagar area, close to the airport. Life insurance: The next of kin of passengers who died in the plane crash can also claim money from the insurance company if the passenger had taken a life insurance policy. LIC and other insurers have announced faster claim disposal in the case of Dreamliner death victims. If the victim had a term insurance policy of Rs one crore, his family can claim the amount. Any bodily injury that the policyholder sustains solely and directly from the accident, independent of other causes, that results in the death of the person within 180 days is deemed as a case of accidental death, ICICI Prudential Life Insurance says. Meanwhile, adding an accidental death benefit rider is entirely optional when a person takes a life cover. It can be beneficial for people who travel frequently. The accidental death benefit payout is given to the nominee in addition to the death benefit from regular life insurance. The rider can be helpful in providing enhanced financial protection to families, it says. Travel insurance: The families of plane crash victims can also claim insurance if the passenger had taken a travel insurance policy. Insurance companies offer travel policies which include an accidental death and dismemberment (AD&D) benefit that provides a lump-sum payment to the beneficiaries in the event of the insured's death or dismemberment as a result of an accident during the trip, including air travel accidents. Several flights cancellations and delays have happened in the wake of the Dreamliner crash and the Iran-Israel war of late. 'Travel Insurance covers the expenses incurred for the time duration that you spend waiting for the flight. One gets reimbursement for the meals, refreshments and essential purchases depending upon the Sum Insured and policy coverage schedule. For flight cancellation, usually the cancellation has to be due to a valid reason such as weather disturbances, terrorism activity or natural disaster,' HDFC Ergo says in its explanatory note. Card insurance: Family members of persons who lost their lives in the Air India Boeing 787 Dreamliner crash can also claim insurance on some of the eligible debit cards owned by the deceased. Some banks provide complimentary personal air accident insurance cover in case of death on eligible debit cards. However, the insurance cover varies based on the category of the debit card owned by the holder. The catch is that there are several riders like the usage of card and one transaction in preceding 30 days for making a claim, which may not ultimately benefit the cardholder.
News18
18-06-2025
- Business
- News18
Plane Crashes, Road Mishaps, Bridge Collapses: India Needs National Plan To Aid Accident Victims' Kin
Last Updated: The plan should offer financial support proportional to the family's annual income, ideally around 10 times that amount, ranging from Rs 10-50 lakh A recent series of accidents has highlighted the challenges faced by the families of victims and the importance of providing prompt financial support to help them recover. Although the Tata group announced Rs 1.25 crore for each family affected by the Ahmedabad plane crash, other victims receive considerably less, such as Rs 5 lakh for families of the Uttarakhand helicopter crash victims and the Pune bridge disaster victims. The fate of road accident victims' families often depends on whether the accident makes national news, which may result in some relief being announced by state CMs or from the PM relief fund. However, this aid is usually insufficient for long-term support. Families of unreported accidents struggle daily with both emotional loss and financial hardship. There is an urgent need for a national response plan for all accident victims, covering road accidents, air accidents, lightning, floods, landslides, and bridge collapses. This plan should activate automatically upon the reporting of any fatal accident, without the need for political declarations. The plan should offer financial support proportional to the family's annual income, ideally around 10 times that amount, ranging from Rs 10-50 lakh. An immediate payment of Rs 2-3 lakh should cover last rites, with the remainder provided within 2-3 months. The total sum could be paid in instalments to prevent misappropriation. Injured victims should receive funds for treatment. Permanent disability should result in proportional compensation. The recent central government scheme offering Rs 1.5 lakh in cashless treatment is a good start but inadequate for severe injuries. While many accident victims might be covered under insurance, this is not always sufficient. Commercial airline crash compensation follows the Montreal Convention of 1999 but can take years to be processed. Interim compensation, like that announced by Tata Group, helps families survive until the actual compensation is received. Helicopter crash victims, like those in Uttarakhand, often face significant challenges in securing compensation due to financial instability of the operators and potential missed insurance payments. For road accident victims, the Motor Accidents Claims Tribunals often take years to settle, with decisions frequently challenged in higher courts, leaving families in prolonged distress. Hit-and-run victims have an even tougher situation, with no clear party from which to claim insurance, forcing families to seek help from various government offices. Most road accident victims are working-age individuals, leaving behind dependents who struggle without immediate financial aid. Children often have to abandon their education, and families fall into poverty. When multiple family members are injured or killed, the financial burden is even greater. Children orphaned by accidents may end up with relatives who may not have their best interests at heart, sometimes even losing their rightful property. A World Bank report from 2021 highlights that low-income households in poorer states suffer disproportionately from road crashes, with over 75% reporting income declines and resorting to high-interest loans, trapping them in poverty. Timely compensation can prevent this cycle. Assured, timely financial assistance from the government can help families recover, live with dignity, and ensure children's futures are not compromised. Advertisement To ensure necessary support, the government could release Rs 5 lakh immediately following an accidental death in public spaces or due to a disaster. The remaining amount can be provided within a few months after assessing the family's needs. The funds could be distributed as an annuity to ensure financial stability. The responsible party, whether an insurance firm or a contractor, can be determined later through legal processes. Funding this initiative could involve collaborating with public sector life insurance companies to cover all 140 crore Indians. The premium could be funded through pooling third-party premiums, a nominal cess on fuel sales, and a small income tax surcharge. The rest would come from budgetary allocations. top videos View All The scheme should work alongside existing insurance plans, deducting any amounts already awarded by tribunals like the Motor Accidents Claims Tribunals. In 2023, India recorded 1.72 lakh road accident deaths. Including deaths from other causes like floods, landslides, and fires, the total would be around 2 lakh per year. With an average payout of Rs 20 lakh per death, the total funding required would be Rs 40,000 crore. This amount would reduce the need for separate ex-gratia payments by state or central governments. Additionally, the financial pressure would motivate the government to enforce better laws and regulations to reduce accidents. tags : accident Compensation insurance plane crash Location : New Delhi, India, India First Published: June 18, 2025, 23:24 IST News opinion Plane Crashes, Road Mishaps, Bridge Collapses: India Needs National Plan To Aid Accident Victims' Kin
New Indian Express
17-06-2025
- General
- New Indian Express
2010 Mangaluru plane crash victims' kin continue battle for compensation
KOZHIKODE: Fifteen years after the tragic Mangaluru air disaster, families of the victims continue to wage an uphill legal battle demanding rightful compensation as mandated under the Montreal Convention. Despite initial assurances of Rs 75 lakh per deceased passenger, many kin allege they have received only a fraction of the legally entitled amount, forcing them to seek justice through the judiciary. The 2010 crash of Air India Express Flight IX-812, a Boeing 737-800 arriving from Dubai, remains one of India's deadliest air disasters. The aircraft overshot the table-top runway at Mangaluru International Airport and plunged into a gorge, killing 158 of the 166 passengers and crew on board. Krishnan, one of the bereaved family members and a petitioner in a case before the Kerala High Court, expressed anguish over the meagre payouts. 'We lost everything that day including our loved ones, our savings, and our future. Yet the compensation offered is a mere token. It's an insult to our loss,' he said. Alongside him, Mayankutty and dozens of others have also filed legal petitions contesting the compensation process. According to Narayanan Killingom, president of Mangaluru Air Crash Victims' Families Association, the airline has yet to disburse the full statutory or 'no-fault' liability amount under the Montreal Convention. 'My brother Gangadharan worked as a truck driver in Dubai. His death devastated our family. We were promised `75 lakh, but later negotiations reduced that. For the families of the deceased, these negotiations should never have applied,' Narayanan said. He confirmed that 42 families remain in legal pursuit of the balance compensation. Compensation discrepancies and legal loopholes Under the Montreal Convention of 1999 ratified by India and incorporated into Indian law via the Carriage by Air (Amendment) Act, 2009, victims' next of kin are automatically entitled to up to 100,000 Special Drawing Rights, an international currency basket defined by the IMF, amounting to roughly Rs 1.52 crore at present exchange rates. This automatic entitlement is classified as 'strict liability,' requiring no proof of fault on the airline's part. Beyond this limit, families can claim additional damages if they can demonstrate negligence or fault by the carrier. However, the onus of disproving fault lies with the airline. In many cases, the airlines have resisted higher payouts by settling quickly and quietly with economically weaker families, offering them reduced compensation in exchange for signing waivers.
News18
13-06-2025
- Business
- News18
Air India Crash May Trigger Over Rs 1,500 Cr Insurance Claims: Here's The Breakdown
Last Updated: India became a signatory to the Montreal Convention of 1999 in 2009. Consequently, specific rules will govern insurance claims for air disasters and damage Thursday's Ahmedabad Air India crash could lead to one of the largest aviation insurance claims in recent times. India became a signatory to the Montreal Convention of 1999 in 2009. Consequently, specific rules will govern insurance claims for air disasters and damage. Sources indicate the AI 171 crash will trigger an insurance response exceeding Rs 1,500 crore. With over 240 lives lost of passengers and crew and the aircraft destroyed, the insurance response involves both domestic and international markets. This also includes the damage to the nearby MBBS hostel. According to government sources, the following are the insurance highlights: the aviation policy is led by Tata AIG General Insurance, supported by Indian co-insurers such as GIC Re, United India, Oriental Insurance, and ICICI. Around 95% of the risk is reinsured with major global players, including AIG, AXA XL, and other reinsurers in the London and Bermuda markets. The Boeing 787-8 aircraft, declared a total loss, is insured for an estimated Rs 650–700 crore, based on its age. Under the Montreal Convention, families of deceased passengers are entitled to approximately Rs 1 crore each, which has already been announced. With over 240 fatalities, this could result in payouts exceeding Rs 240 crore. The total projected insurance payout will likely make this one of the most expensive aviation insurance claims. The combined hull and liability exposures may exceed Rs 1,000-1,500 crore, depending on final settlements and legal claims. Furthermore, Air India's fleet-wide aviation cover amounts to Rs 8,000-10,000 crore, with an estimated annual premium of around Rs 250 crore. This event will likely have a significant market impact, potentially hardening the global aviation insurance market, especially for wide-body aircraft operators in India. The government expects the insurance claims to be processed expeditiously. First Published: June 13, 2025, 20:20 IST
Mint
13-06-2025
- Business
- Mint
Air India plane crash: How is aviation insurance payout calculated? Will it be India's costliest? Experts decode
Air India Plane Crash: The Montreal Convention will be governing the insurance payouts to nominees of the passengers who died in the Air India plane crash in Ahmedabad on Thursday, experts have said. While Air India may declare an interim payout, the actual compensation will depend on the coverage purchased by the airline. India is a signatory of the Montreal Convention, applicable provisions of which will be applied while implementing the insurance payouts, they said, according to a report by PTI. According to Prudent Insurance Brokers vice president (aviation & specialty lines) Hitesh Girotra, the minimum liability applicable to the airline operator will be dependent on the nationality of the passengers who lost their lives. While an interim compensation may be announced by the airline, the final insurance payouts for passengers will be determined under the Montreal Convention of 1999, to which India became a signatory in 2009, brokerage firm Howden (India) MD and CEO Amit Agarwal said. "Compensation is calculated using Special Drawing Rights (SDRs), which stood at 128,821 SDRs (approximately $1.33 per SDR) as of October 2024. The actual payout will depend on the coverage purchased by Air India," Agarwal was quoted as saying by PTI. According to Amit Agarwal, the compensation for the Air India aircraft damage will be covered under the aviation hull all-risk section. This includes insurance for the current valuation of the aircraft, including spares and equipment. For a Dreamliner, depending on its configuration, age, and other factors, this value can range between $211 million and $280 million, he said. 'The aircraft involved (VT-ABN) was a 2013 model and, based on available information, was insured for approximately $115 million in 2021. Whether the damage is partial or total, the loss would be covered based on the value declared by the airline,' he said. According to Narendra Bharindwal, president, Insurance Brokers Association of India (IBAI), aviation insurance programmes for major airlines such as Air India are arranged on a fleet basis and reinsured across international markets like London and New York. 'No single insurer bears the entire risk -- coverage is widely distributed among global reinsurers, with shares as small as 1.5 per cent to 2 per cent and a lead reinsurer typically taking 10-15 per cent. The financial impact of such incidents is shared globally across this network,' he said. Currently, Air India and IndiGo are the two Indian airlines operating the Boeing 787 planes. Of the 34 B787s in the Air India fleet, 27 B787-8s are legacy aircraft. The first of the legacy B787-8 is slated to go for retrofit in July. The remaining seven B 787-9 joined the Air India fleet after the merger of Vistara with it last year. Globally, the Ahmedabad crash is the first time that hull loss has happened for a B787 aircraft, according to an official.
