Recent Developments in the Aviation Insurance Industry

Risk Management and Insurance Review, 2009

Posted: 13 Jan 2009 Last revised: 14 Jan 2009

See all articles by Triant Flouris

Triant Flouris

York College CUNY

Paul Hayes

Ascend Worldwide

Kuntara Pukthuanthong

University of Missouri, Columbia

Thomas John Walker

Concordia University, Quebec - Department of Finance

Multiple version iconThere are 2 versions of this paper

Date Written: January 13, 2009

Abstract

The aviation industry has been hard hit in recent years. While there are numerous factors that have contributed to the industry's dilemma, rising and volatile insurance premiums - particularly after the events of 9/11 - have posed a particular problem for many airline managers. Despite a general trend for accident rates involving commercial passenger airplanes to decrease as aviation technology has advanced over the years and airplanes have become safer, the aviation insurance market has been far from stable. This paper provides an overview of how the aviation insurance industry works and how it has changed in recent years. We take a look at how the risk is spread between insurers, how insurers treat deliberate acts of violence and, lastly, how insurers price the risk. Our paper shows that the aviation insurance market has undergone considerable changes in recent years and that it has adjusted to the post 9/11 aviation insurance realities being reasonably ready to handle events of an even more catastrophic magnitude.

Keywords: Aviation Disasters, Aviation Insurance, Reinsurance

JEL Classification: D81, G22, L52, L93

Suggested Citation

Flouris, Triant and Hayes, Paul and Pukthuanthong, Kuntara and Walker, Thomas John, Recent Developments in the Aviation Insurance Industry (January 13, 2009). Risk Management and Insurance Review, 2009 , Available at SSRN: https://ssrn.com/abstract=1326780

Triant Flouris

York College CUNY ( email )

94-20 Guy R Brewer Blvd,
Jamaica, NY 11451
United States

Paul Hayes

Ascend Worldwide ( email )

505 East 82nd St.
Suite 6D
New York, NY 10028
United States

Kuntara Pukthuanthong (Contact Author)

University of Missouri, Columbia ( email )

Robert J. Trulaske, Sr. College of Business
403 Cornell Hall
Columbia, MO 65211
United States
6198076124 (Phone)

HOME PAGE: https://www.kuntara.net/

Thomas John Walker

Concordia University, Quebec - Department of Finance ( email )

Montreal, Quebec H3G 1M8
Canada

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