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Member, Beacon International Group, Ltd.
OKINAWA, Japan--Global Aerospace Underwriting Managers Ltd. of London is the lead aviation liability and hull insurer for China Airlines, which sustained a $45 million hull loss Monday when one of its Boeing 737-800 passenger jets exploded on an airport tarmac shortly after landing in Okinawa, Japan.
All 157 passengers and eight crew members--including two pilots who jumped from a cockpit window--escaped the jet safely before it exploded. The jet had landed early from a flight originating in Taipei, Taiwan, where China Airlines is based.
The airline has a checkered loss history but was able to cancel its existing coverage early and negotiate a new policy in July for a reduced premium, according to sources. The airline renewed early because of concerns that rate reductions would be difficult to obtain during the commercial airline insurance market's primary three-month renewal season, which will begin Oct. 1.
Chicago-based Aon Corp. placed China Airlines' coverage.
Over the past 10 years, the airline has had four total losses, three of which resulted in 391 fatalities, noted broker Trevor Howard, a partner with Jardine Aerospace, a London-based unit of Jardine Lloyd Thompson Group P.L.C.
The number of total losses for the airline is "quite extraordinary," Mr. Howard said. And the number of fatalities is high, he said. On average, the world's 400 airlines sustain 24 total losses that result in 1,000 fatalities annually, Mr. Howard said.
Over a 10-year period, that averages 25 fatalities and less than one loss per airline.