Airlines will benefit from lower insurance costs after claims declined for a third year running as reduced accident rates and increased competition among insurers keep premiums down, according to a report from insurance broker Aon Risk Solutions.
Claims dropped 20% last year to $924 million as premiums fell 11% to $1.61 billion. “For an industry with remarkably inflexible cost-base, insurers certainly played their part in contributing significant percentage cost savings in 2012,” it said.
“The outlook for airline insurance purchase in 2013 is very positive,” said Simon Knechtli, chairman of Aon’s aviation unit. “It will take a series of losses, or one very large loss in 2013 to create a change in current market trends.”
Crashes for western-built aircraft have declined significantly, says IATA data that notes the accident rate fell to 0.20 accidents per million sectors from 0.37 a year earlier.
Airline insurance costs decline, says AON
