USD110 m paid for missing flight mishap

The mishap of the Malaysia Airlines flight that ended its journey in the southern Indian Ocean has resulted in the handover of USD110 million to the airline by insurers.

The Telegraph reported that the USD110-million payout was made in accordance with standard air travel industry policy which states that if a plane has been missing for more than two days, then it is assumed it has been destroyed.

The policy was originally taken out in Malaysia but, as is common practice in the industry, it was reinsured with a group led by Allianz. The other reinsurers include GIC Re, Hannover Re, Lonpac Insurance, Malaysian Re and Eurasia.

The primary insurance cover for the aircraft is written 100 percent by Etiqa Insurance & Takaful, a domestic Malaysian carrier with the majority of the risk ceded to the global panel of reinsurers. The payout could also cover hardship payments to families of passengers on board the flight.