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MORONI, Comoros—A passenger jet from Yemen that crashed into the Indian Ocean Tuesday was covered under a policy led by ACE Global Ltd., market sources say.
Yemenia Airways Flight 626 was approaching Moroni, the capital of the island nation of Comoros, when it crashed 12 miles off the coast amid reportedly heavy winds. The plane was carrying 142 passengers and 11 crew members; a child reportedly was the only survivor.
The Airbus A310-300 was valued at $34 million, and the coverage was placed through London-based brokerage HSBC Insurance Brokers Ltd., according to sources.
Yemenia is a member of a consortium of several Middle Eastern airlines, with the ACE Ltd. unit leading the hull and liability coverage for the member airlines, sources said. Each airline uses its own broker. The consortium renews its coverage in November, according to Aon Corp.'s aviation and aerospace global practice group in London.
The Tuesday crash was the third fatal accident this year involving a Western-built jet and the first ever suffered by Yemenia, according to Ascend Worldwide Ltd., a London-based aviation consultant that tracks global accident data.
Paul Hayes, director at Ascend, said although accidents are not evenly distributed throughout the year, the 362 fatalities on Western-built passenger jets so far this year is not an unusually high number. “Typically, I'd expect on average about 600 (fatalities) on Western jets (per year), so it's not out of the ordinary,” he said.
But the high profile nature of some of the incidents—including the June 1 Air France crash in the Atlantic Ocean; the Feb. 12 crash of a Colgan Air jet in Buffalo, N.Y.; and the Jan. 15 nonfatal ditching of a US Airways flight in the Hudson River in New York—is influencing negotiations with underwriters, brokers say.
“Loss activity is clearly impacting renewals,” said Wayne Wignes, Chicago-based vice chairman of JLT Aerospace (North America) Inc.
Most airlines around the world renew their coverage at the end of the year, but July is the second-busiest renewal month behind December, according to Aon.
Magnus Allan, an aviation analyst at Aon, said that among 15 July renewals that have been completed so far, the average renewal is up about 22% over last year. “Overall it's going to be a very, very challenging next few months for carriers as they bring in their renewal business,” he said.