Aviation insurance is one of the most specialized insurance which is completely different as compared to other types of insurance. This insurance covers the journey through aircrafts.History of aviation insurance begins from the 20th century when the first aviation insurance policy was developed in a written form by London Lloyds in 1911. However, the insurance company faced a lot of problems due to high number of crashes that cause huge amount of losses.
From 1933, the airline industry was established in a proper way, and the concept of aviation insurance was developed in order to minimize the risk regarding flights. The International Union for Marine Insurance formed a committee for aviation insurance in 1934. Finally, eight insurance companies were formed at the same time under an active participation of International Union of Aviation Insurers.
Types of Aviation Insurance
Aircraft Hull Insurance: There is not any insurer who has resources to bear the risk of an airline. There is a large amount of loss in the aviation accidents. So, the insurance amount is determined on the basi8s of risk which is may be with various types.
Aviation Liability Insurance: Aviation liability insurance is generally divided into two parts that may be the liability in favor of passengers, cargo, baggage and mail which is carried in the aircraft. All the liabilities are associated with the flight operations which are performed by the airlines.
General Aviation Insurance: There are many aviation insurance companies in the financial market which plays vital role to protect the airlines from huge amount of losses in case of accidents. There are number of private airlines which operate their own airbuses and covered under the aviation insurance.
No airline wants to bear risks in their daily operation either it is small and domestic airlines or international airlines. Obviously, if there are small aircrafts which are operating short flights in the remote area, it will carry less risk as compared to long route aircrafts and the insurance amount is determined on the basis of risks.
