JetPiedmont

Something for your union negoiatiors to consider during the next round of contract talks. Seems management has been enjoying a significant reduction in Hull Insurance rates for airline fleets since 2000 due to the "impressive safety record" achieved by the airlines.

Funny they never mentioned that to us. Just to give you a rough idea, annual premiums average around 2 billion, so 20% off that is 400 million in savings.

Airline Insurance Market Review highlights accelerated premium reductions



1) the low-cost sector continues to thrive, with an average 6% reduction in lead hull and liability premium despite fleet growth of 15% and carrying 22% more passengers;

2) the market continues to reward economies of scale, with operations with a fleet value of more than US$5 billion receiving an average premium reduction of 22%;

3)competition has continued to put pressure on the excess third party liability market, which has delivered US$6 billion of profit to participants since 2001, despite there being no claims.

4) The high level of capacity in the market is expected to continue into 2008 and the anticipated continued decrease in lead premiums could potentially prompt some capacity to exit the market. This may well be brought forward should any consolidation among underwriters occur.

Meanwhile, the cumulative loss record for 2006 is slightly lower than 2005. While the small number of hull losses in 2005 was very impressive very impressive, the number of fatalities was the highest since 2000. There have been fewer fatalities in 2006 with a notable reduction in losses at the smaller end of the market.

Steven Doyle says: “Prior to October, the market had looked to be on course to deliver another 7% reduction on the total hull and liability market figures for 2005, continuing a trend that had been in place since 2003. The introduction of new capacity and the excellent industry loss record, however, reduced the hull and liability market by 17% compared to 2005. As a result, the airline insurance market dropped below the US$2 billion level for the first time since 2000. It seems likely that the benign market conditions, at least from an insurance buyer’s point of view, will continue until at least next October, unless there is a significant loss or major consolidation in the underwriting community.”

Spaceman Spliff

Great find! ...and you're not even being paid to discover and communicate this great information!

Did you see this, ALPA National? Wait...of course not.