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Member, Beacon International Group, Ltd.
BRUSSELS, Belgium--The European Union will allow member states to extend their government-backed aviation war and terrorism insurance packages for another month while an alternative plan is developed.
Aviation insurance rescue packages had been due to expire at the end of May, but the European Commission's transport spokesman announced Monday that an extension had been granted until June 30.
"It will give the airline industry time to set up its own mutual insurance fund," the spokesman said. Last week, U.S.-based airlines applied to license a Vermont-based risk retention group, known as Equitime.
Brokerages Aon Group Inc., Marsh Inc. and Willis Group Ltd. have said they will seek E.U. approval for a European equivalent of the Equitime project. Their proposed pooling arrangement, known as Eurotime, would provide war risk and aviation coverage of up to $1 billion. The pool would be funded by a 50-cent surcharge per passenger, and the pool would initially be backed by the E.U. until it builds up its own reserves.
European transport ministers are scheduled to discuss the proposal at a June 17 meeting.