Allianz confirms $300m reserve for Germanwings
Allianz Global Corporate & Specialty (AGCS), the lead aviation hull and liability insurer for Germanwings flight 4U 9525, has said that the total reserve has been set at $300 million.
AGCS said this will will cover compensation payments to the next of kin of the passengers, as well as the hull value of the aircraft (which is being handled by a separate consortium of hull war insurers), as well as other costs such as accident support and investigation services on the site of the crash, legal support, and assistance for next of kin.
“Lufthansa Group and its aviation insurers, led by Allianz Global Corporate & Specialty (AGCS), can confirm that all claims arising from the loss of Germanwings flight 4U9525 will be addressed fully, fairly and as quickly as possible, in close consultation with the next of kin of the passengers and their representatives,” said the statement.
Lufthansa Group, with support from its insurers, is offering an immediate interim payment of €50,000 on behalf of Germanwings to next of kin to address immediate financial needs.
“Initial reserves are normally set by aviation insurers quickly after a major loss, and reflect the limited information available at this time, taking a conservative and prudent approach. An accurate assessment of final settlement will not be possible for some time. Therefore the reserve figures will be adjusted as full information is confirmed, reflecting the compensation for all affected under these policies, which will be met fully and fairly in line with the applicable law,” said AGCS.
AM Best, in a briefing, said: “This recent Germanwings loss may put further pressure on the beleaguered aviation war sector. Premium rates for this business did rise in 2014 in response to claims activity. However, the level of increase was disappointing given the magnitude of losses, and upward momentum stalled towards the end of the year.”
The plane, carrying 150 people, crashed in the French Alps on its way from Barcelona to Duesseldorf today (Tuesday March 24).
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