Fog losses push airlines to seek insurance

Bangalore: Some airlines have seen the light through the wintry mist of losses: fog insurance. Air-India, for instance, has floated a tender for fog insurance and received bids from over a dozen companies. “We hope to choose a bidder by next week,” said S Venkat, Air-India’s executive director (finance).
Air-India is looking for insurance that will apply if foggy conditions persist for more than four days. In such circumstances, the insurance will cover losses on account of delays, rerouting or cancellation of flights, and provision of hotel accommodation to passengers. The insurance amount may range from Rs15 lakh to Rs1.5 crore, Venkat said.
This is part of Air-India’s strategy to minimise losses stemming from inclement weather.
Air Deccan said its fog insurance scheme would be ready by next winter.
Kingfisher Airlines, which is equipped with CAT-III A, will not seek fog insurance. The state-owned Indian said it finds insurance too expensive an option to consider.
27/12/06 Bhargavi Kerur/Daily News & Analysis

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