Following major lessors like AerCap Holdings, Avolon, and Dubai Aerospace Enterprise, BOC Aviation has also begun legal action in pursuit of claims against 16 insurers for the BOC Aviation-owned aircraft that are stuck in Russia, as per an Irish High Court filing.
As per the filing issued on November 3, 2022, the names of the insurers are Lloyd’s of London, AIG, Chubb, and Swiss Re.
According to Reuters, Lloyd’s and Swiss Re declined to comment and AIG and Chubb did not immediately respond to requests for comment on BOC Aviation’s legal move, which did not include details on the size of the lessor’s claim.
In an earlier filing, BOC Aviation said that it had decided to cut the net book value of 17 leased aircraft remaining under the control of Russian airlines to zero from $803.6 million.
The net impact of the write-down to its pretax profit was $580.7 million, as it will be partially offset by cash collateral of $222.9 million from the airlines. However, BOC Aviation faced a net loss of between $310 million and $330 million for the first half of 2022, compared to a profit of $254 million a year ago.
BOC Aviationsaid in a statement: “It is unlikely to be able to recover those aircraft from Russia in the foreseeable future, if ever." It has recovered only one from the country so far since the start of the war in Ukraine.
Leasing firms have begun pursuing claims over huge losses since losing control of more than 400 leased planes worth almost $10 billion after Western countries sanctioned Russia over its February invasion of Ukraine and Moscow blocked the jets from leaving.
In June, AerCap Holdings filed a $3.5 billion lawsuit at London’s High Court over its insurance claim for more than 100 seized planes, while Avolon and Dubai Aerospace Enterprise (DAE) have also begun proceedings.
Going ahead, BOC Aviation has filed insurance claims to recover the losses and is planning to vigorously pursue them.
Robert Martin, CEO of BOC Aviation, said in August 2022: “The proceedings will keep lawyers busy for many years and may require a complete rethinking of aviation insurance.”
BOC Aviation has a fleet of 612 aircraft owned, managed, and on order. Its owned and managed fleet was leased to 81 airlines in 38 countries and regions worldwide as of 30 September 2022.