MUMBAI --- Hindustan Aeronautics Limited (HAL) has made an insurance claim of around Rs 273 crore ($39.7 million--Ed) on an under-production Sukhoi jet that recently crashed during its test flight near Nashik, Maharashtra. This is the first of its kind insurance claim involving a fighter jet in India.
The claim was filed with a group of reinsurers led by GIC Re and sole insurer New India Assurance (NIA). As much as 90-95 per cent of the claim will have to be met by international reinsurers as such projects are heavily reinsured abroad.
While defence and military projects and materials are not insured, HAL has insured the Sukhois as they are in an under-production stage and these jets are yet to be inducted into Indian Air Force, said an NIA official.
The insurance cover is valid only till the aircraft is handed over to the Air Force in view of the security issues after induction. During 2017-18, NIA was the sole primary insurer for the Sukhoi project with a total sum assured of Rs 11,240 crore. State-owned GIC Re is the lead reinsurer for the deal which is shared with other reinsurers in the international markets, insurance sources said.
Officials said Rs 258 crore is for the crashed fighter aircraft and rest is to be paid to the third parties affected by the crash. Though the total exposure of the NIA for the crashed Sukhoi is at around Rs 20.43 crore, the net losses for the largest domestic general insurer will be around Rs 13.71 crore as the rest will be paid by the reinsurers, said an official.
HAL has paid a premium of around Rs 18-19 crore during the year and may have to shell out 20 per cent higher premium next year due to the Nashik claim, officials said. (end of excerpt)
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