PLANE, CARGO SHIP DISASTERS INSURED IN LOCAL MARKETS

JAKARTA, Indonesia-Thick smoke covering hundreds of square miles in Southeast Asia is being blamed for a recent jetliner crash that killed 234 people and the collision of two cargo ships that killed 29 people.

However, official investigations may determine other reasons for the two disasters, which occurred within hours of each other.

On Sept. 26, a Garuda Airlines A-300B4 Airbus plowed into hillsides on its approach to Medan, Indonesia's Polonia Batu airport from Jakarta. All 222 passengers, including two Americans, two Britons and six Japanese, and 12 crew were killed (BI, Sept. 29).

Reports claimed that the Garuda airliner was lost in haze resulting from raging forest fires set off deliberately to clear land. However, other reports claimed the pilot and the Medan air traffic controller misunderstood each other during the last minutes of the flight, indicating human error.

Coverage for the plane's $14 million hull and liability for an unknown limit is placed with Jasa Indonesia Asuransi P.T. in Jakarta. The reinsurance was placed by Willis Corroon Group P.L.C. and led in Paris by La Reunion Aerienne.

Indonesia has had two other passenger flight disasters this year, according to Airclaims Ltd. On July 17, a Netherlands-built Sempati Air commuter plane crashed nearing a housing complex on the island of Java, killing 27 people. On April 19, 15 people were killed when a British-made ATP turboprop plane flown by state-run Merpati Nusantara airline crashed off the island of Sumatra.

Meanwhile, property insurance claims from the two cargo ships that collided in the Strait of Malacca are not expected to total much more than $10 million, though there should be additional claims for the 29 lives lost.

One of vessels, the ICL Vikraman, a bulk carrier with a cargo of 53,000 metric tons of steel coils and some general cargo, sank with only five of the 34 on board surviving. The vessel was owned by India Cements Shipping Co. Ltd.

Lloyd's of London had no record of involvement in insuring the vessel. Stephen Redmond, underwriting director for Eagle Star Reinsurance Co. Ltd. in London, said Indian-owned vessels are usually insured in India, with the London market providing some treaty reinsurance.

The other vessel in the collision, the Mount I, recently bought by Five Star Shipping of Karachi, Pakistan, was only slightly damaged and reported no injuries.