Air India has taken a Rs 60,800 crore ($8 billion) cover by paying a Rs 266 crore premium to a clutch of insurance companies, including Tata AIG General Insurance. The airline’s management dealt with the better value of its fleet lower by almost $2 billion. On the other hand, new management held extensive negotiations in India and London to get a good deal considering the rising premiums due to the ongoing Russia-Ukraine war. According to the new policy, the airline will not be able to fly over Russian and Ukrainian airspace due to the conflict.
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Air India has a fleet of 117 aircraft, while Air India Express has a fleet of 24 narrow-body aircraft.
Tata AIG General Insurance, for the first time, received a 30 per cent share from one of its parents; AIG continued to be the re-insurer leader of the new policy. New India Assurance has taken the highest share of 40 per cent of the policy, while ICICI Lombard has received a six per cent share in the policy.
The Indian companies will pass on 95 per cent of the premium and risk to the foreign re-insurers to de-risk their books in case of any accidents.
