Marsh has created a non-payment insurance product designed for banks and capital market investors that are funding new aircraft purchases from Boeing.
The Aircraft Finance Insurance Consortium (AFIC) provides an alternative aircraft finance insurance product for new aircraft deliveries.
AFIC is underwritten by Allianz, AXIS Capital, Sompo International (formerly Endurance) and Fidelis.
This structure has already been used by a major international airline to support the financing of new Boeing 747 and 787 aircraft, according to Marsh.
AFIC aims to obtain more efficient financing by utilising insurance to protect the lender’s exposure to default for the duration of the loan.
"We believe that AFIC is a significant development in airline financing globally and will contribute to the growth and diversification of aircraft finance,” said Bruce Fine, global leader of AFIC for Marsh. “AFIC offers Boeing customers a wider range of financing options to facilitate the purchase of newer, more efficient aircraft to enhance their fleets, and lenders will be able to conduct new transactions with greater confidence."
Marsh, Aviation, Insurance, Allianz, AXIS Capital Sompo International, Fidelis, UK