Aviation war risk insurance remains available for airlines operating across the Middle East, the Lloyd's Market Association (LMA) said on April 1, even as a wave of airport attacks and mass flight cancellations continue to roil the region's airspace.
Neil Roberts (pictured above), head of marine and aviation at the LMA, said McKenzie Intelligence Services had confirmed that six international airports across Bahrain, Iraq, Kuwait and the UAE were attacked over the preceding month.
More than 20,000 flights were cancelled during the same period, with airspace closures occurring intermittently across several affected countries.
The LMA surveyed members of its Aviation War Committee within the previous 24 hours. All respondents confirmed they retain appetite to underwrite hull and liability war risks, with most existing aviation war policies remaining in place.
Roberts said most committee members had not observed any pricing increases for non-war cover on overflights. "In summary, insurance is available for any airlines wishing to fly where airspace is open across the Middle East," he said.
The cost of war risk cover has nonetheless varied across carriers. Emirates is paying roughly US$100,000 per week in additional premiums to insure its entire fleet, while rival international carriers have been quoted between US$70,000 and US$150,000 per individual flight into the Gulf.
Several carriers, including British Airways, Lufthansa and Cathay Pacific, have suspended services to the region until at least the summer. The divergence in both pricing and operational decisions reflects the uneven impact on airlines with differing route exposure and risk profiles.
Roberts added that aviation operators had not received blanket notices of cancellation from insurers and were not consistently facing rate increases.
Since the conflict began, the LMA has been coordinating with aviation insurers to ensure they receive "immediate notice of a 'material change' in the insureds' operations as they resume flying when airspace opens," Roberts said.
While underwriters have not issued blanket cancellation notices, Roberts noted they require a clear understanding of the full extent of their exposure. The aviation war risk market continues to function, though the widening gap in premiums between carriers suggests the pricing environment remains unsettled.
