The aviation insurance market was reviewing proposals to invoke new exclusions in policy coverage to exclude a number of “perils” under AVN 48C. The aviation insurance underwriters were also proposing to withdraw provisions for write-back with respect to these new exclusions.
Since then, the Aviation Insurance Clauses Group (AICG) has undertaken extensive consultation with the aviation industry, and in 2006, the group completed its consideration of these aviation war clauses.
A number of governments have specific regulations governing the liability coverage of those “perils”, for example, the USA (DOT 14 Part 205); Canada (Part 7 of the Canadian Transportation Agency Air Transportation Regulations); Switzerland (Air Navigation Act of 1948 and Air Navigation Decree of 1973); and Australia’s Civil Aviation Act (Carrier’s Liability) 1959.
However, there are also many governments that stipulate minimum insurance requirements as part of their operation certification such as the EU Regulation 785/2004 that entered into force on 1 May 2005. EU 785/2004 stipulates compliance by airlines with minimum insurance coverage for war and terrorism risks.
Non-compliance with these requirements could result in sanctions, including denial of landing rights and the refusal of overflights into controlled airspace, for airlines. Therefore, AAPA believes that acts of war and terrorism are targeted at States, and that it is the responsibility of governments to assume the liabilities resulting from such acts.
In 2004, AAPA calls for the provision of appropriate government measures/assurances to ensure that the aviation industry is able to continue operating without the liability coverage for losses as a result of the “perils” stipulated in the exclusion clause designated AVN 48C.
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