Air India plane crash, airline insurance premiums may increase by 30%!
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Civil Aviation Resources Network, June 23, 2025: According to Bloomberg, Indian policy sellers expect airline insurance costs to soar by as much as 30% after the deadliest aviation accident in more than a decade in India.
Sajja Praveen Chowdary, director of Indian brokerage Policybazaar, expects premiums for aircraft hull, war risk and liability insurance to increase by 10% to 30% in the next renewal cycle. Rohit Boda, managing director of J.B. Boda Group, predicts an increase of 10% to 25%.
Brokers said that given the severity of the Indian aviation accident, this scale of premium increase will exceed the increase in previous accidents. The Air India crash on June 12 killed 241 people on board and dozens on the ground.
Bloomberg reported earlier that insurance claims for the Air India accident are expected to be around US$475 million, including claims for the aircraft hull and engine, as well as additional liability due to casualties. According to Policybazaar, the total insurance coverage of Air India's fleet is about $20 billion, with annual premiums approaching $30 million.
"A crash of this magnitude will lead to higher premium rates around the world," Chowdary said.
A report by insurance giant Allianz shows that in the five years to 2024, crashes account for the majority of $15 billion in aviation claims worldwide. Growth in air travel, led by Asia-Pacific and North America, is expected to push premiums to more than $8 billion.
The increase in premiums will apply to all airlines and the impact on airlines will be redistributed globally, people familiar with the matter said. The increase in premiums is expected to be large, and if there are more plane crashes in the future, it may lead to record high premiums.