Insurance costs continue to decline for aerospace firms: Aon Risk Solutions
Aon Risk Solutions, in its Aerospace Market Outlook, stated insurance costs continue to decline for aerospace firms (AINOnline, 06-Jun-2011). The industry is now starting its fifth consecutive year of falling premiums with Aon CEO Peter Schmitz stating a key driver of this trend is that underwriters are giving companies credit for the improvements they have made in safety and risk management. “Aerospace continues to be a safe haven for capital providers,” he concluded. Total premiums billed to aerospace companies for the 2010/11 insurance year reached USD774 million, down from YSD797 million for 2009/10 (or USD783 million on a like-for-like basis). During 2009/10, no insured company was lost to bankruptcy and only one firm disappeared from the insured list due to consolidation. Among airlines, premiums have remained static overall although Aon noted that this figure is distorted by a large premium decline for one major claim. Excluding this, average rates increased by 5%. The value of airline claims in 2010 stood at USD2.1 billion, higher than the average of USD1.5 billion reported annually since 1996.