On June 12, a horrific aircraft accident near Ahmedabad Airport in India shook the entire country. Air India flight AI-171, which was a Boeing 787-8 Dreamliner, crashed as soon as she flew. All 241 people in the aircraft died in this accident. Apart from this, some people lost their lives in nearby doctors hostels due to the fall of aircraft. After this painful accident, Air India has announced a compensation of Rs 1 crore to the families of the deceased. However, this compensation is just initial assistance. This insurance claim can reach Rs 1000 crore.
In such cases the real compensation will be set under the Montreal Convention 1999, which India accepted in 2009.
What is Montreal Convention?
Montreal Convention is an international rule, under which the dead and injured are compensated in aircraft accidents. Under this, the airline has to pay compensation up to 1,28,821 Special Drawing Rights (SDR) for the death or injury of any passenger. According to October 2024, the price of 1 SDR was $ 1.33 (about 111 rupees). That is, compensation of up to Rs 1.43 crore can be made for every passenger. If the airline’s negligence is proved, then it can also get more compensation.
How many passengers were in aircraft?
There were a total of 242 people in the aircraft at the time of the accident, including 169 Indian citizens, 53 British citizens, 1 Canadian and 7 Portuguese citizens. All these people lost their lives in this accident.
How and what is aircraft insurance?
Air India has insured its entire aircraft fleet under a global $ 20 billion aircraft insurance program. There are two types of insurance.
Hull Insurance) – It covers the damage done to the aircraft.
Liability Insurance – It gives compensation for the damage done to passengers and third party.
According to experts, the aircraft can be priced between $ 211 to $ 280 million. However, the insurance value of this aircraft (VT-Abn) of the 2013 model was $ 115 million in 2021.
Where will compensation come from?
Air India has been insured in collaboration with many international companies. Insurance is not responsible for the same company, but in many companies in 1.5% to 15% parts. Therefore, the economic impact of this major accident will be on the insurance companies of the whole world.
How much can be the total compensation?
Apart from the loss of aircraft, the biggest cost will be passengers and third party compensation. The total compensation can go up to Rs 1,000 crore. This Indian aircraft can become one of the most expensive accidents in history.
How will compensation be fixed?
Compensation may vary in case of every passenger. The compensation amount is fixed based on the age, job, income, family status and number of dependents. This incident is not only a tragic chapter for Indian aviation, but also a big case from the perspective of insurance and legal responsibilities. In the coming time, this case indicates further hardening guidelines of aircraft security and insurance at the country and international level.
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