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Air India Crash: Amidst Higher Insurance Costs In The Future, Your Air Ticket Could Get Costlier By 2-5%
- The recent Air India crash is expected to lead to higher insurance costs, potentially increasing air ticket prices by 2% to 5% for consumers.
- The crash is anticipated to reshape how risks are underwritten and priced, especially for Indian operators, due to factors like international exposure and high-value claims.
- The combination of various global incidents, including the Air India crash, is prompting reinsurance providers to reevaluate risk pricing for Indian aviation more carefully.
- Aviation insurance premiums in India, historically competitive, may see an upward revision as global reinsurers reassess the market.
- Major airlines like Air India have their insurance programs arranged on a fleet basis and reinsured internationally, with premium adjustments likely in the next underwriting cycle.
- While immediate premium changes are not expected, multiple aviation incidents worldwide are likely to influence renewal terms and premiums for the sector.
- Insurers are expected to consider India's growing market while factoring in the effect of recent incidents on the aviation insurance market.
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