On September 24, Signature Flight Support began requiring customers at its worldwide chain of 46 FBOs to sign an “indemnification agreement for acts of war and terrorism.” The “hold harmless” agreement was the result of a decision by insurers to cancel Signature’s extended coverage endorsement for war risk liability insurance, effective 8 p.m. that day.
Since September 11, a growing number of countries are requiring that aircraft overflying or landing at their respective airports carry war-risk insurance.
Before September 11, insurance occupied no more than an afterthought in the minds of most in the aviation industry. For years, premiums had remained relatively stable, even reasonable, and standards of coverage conformed to the level of threat, perceived as minimal. In the years ahead, the aviation industry will look back at those as “the good old days.”
Business aircraft and large charter operators may start seeing reduced insurance premium rates within the next few months, if they haven’t already. According to various brokers, insurance premiums for certain segments of the business aircraft and charter market have fallen by 25 percent or more in the past six to 12 months.
The object of the regulation is to set minimum insurance requirements for air carriers and aircraft operators regarding coverage for passengers, baggage, cargo and third parties. The rule applies to all operators flying into, out of, within or over the territory of a member state. The new insurance levels are tied directly to the mtow of the aircraft and a special drawing right (SDR).
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