Reinsurance News

AIG lead reinsurer for Pakistan flight crash: reports

29th May 2020 - Author: Matt Sheehan

American International Group, Inc. (AIG) is reportedly on the hook as the lead reinsurer for the plane that crashed into a residential area of Karachi, Pakistan on May 22nd, according to Reuters.

Source: Asif Hassan/AFP

Airline documents show that the plane was insured for $19.7 million, with Pakistan’s National Insurance Company (PIC) acting as the insurer and Marsh as the reinsurance broker for the annual policy.

Pakistan International Airlines (PIA) Airbus SE A320 was attempting to land at Karachi’s Jinnah International Airport when it lost control and crashed, killing 97 of the 99 passengers and crew on board.

A cockpit voice recorder recovered from the wreckage shows that the pilot announced he could not open the plane’s landing gear, and hit the runway three times on his first approach to the airport.

Reports suggest the engines may have been damaged as they were scraped along the runway during this first attempt at landing.

Tremor - The modern way to place reinsurance

After regaining altitude, the pilot then said that both engines had failed, causing the plane to come down less than a mile short of the runway as it turned back for a second attempt.

Ghulam Sarwar Khan, Pakistan’s Minister for Civil Aviation, believes that the fault lies with the pilot, who did not announce his landing gear wasn’t operational and approached the runway from an improper height, before “haphazardly” touching the engine to the ground multiple times.

However, safety experts have warned that it remains to early to establish a definite cause for the crash, and said that several factors could be involved.

For many re/insurers, the incident will be a grim reminder of the Ethiopian Airline crash back in March 2019, which resulted in the suspension of Boeing’s entire global fleet of 737 MAX aircraft.

The US aircraft manufacturer Boeing ultimately recovered $500 million from its re/insurance program for losses related to this crash.

Print Friendly, PDF & Email

Recent Reinsurance News