Connect with us

Business

How airline accident claims are handled : The Standard

Published

on

Loading...

[ad_1]

Boeing 737 Max (PHOTO: Courtesy)

Whenever there are fatal airline crashes, insurers and the airlines concerned tend to approach dependents of the deceased.

This, to avoid battling claim cases in different countries with different jurisdictions.
Sometimes the airlines set the maximum claims per person especially if the airlines can demonstrate there was no negligence on their part.
The amounts are determined in the same way as in all other accidents and damages. A perished breadwinner or a well-paid passenger with dependents is likely to attract bigger compensation than, say, a college student or a retiree.

SEE ALSO :KQ moves to wrap up airport takeover

The amounts paid will also depend on the jurisdiction in which a case is filed.
When a Lufthansa Airbus A320 crashed in the Swiss Alps in 2015 killing 150 passengers, respected business TV channel CNBC quoted experts saying the compensation amounts could possibly be according to the Montreal Convention.
It defined the Montreal Convention as a multilateral treaty on air travel, according to which, family members are entitled to make their claims in either the carrier’s home country or where the victim was based as long as the airline also flies in that country.
 Aircraft owners or companies that service their planes often face huge claims if they are adjudged to be in fault.
Insurance and aviation sources say Boeing Company insurers face big claims from families of the victims of the Ethiopian Aircraft crash, coming less than six months after the crash of the same type of Boeing aircraft in Indonesia.

SEE ALSO :All 157 in Ethiopian airliner crash dead

An Ethiopian Airlines passenger jet bound for Nairobi crashed minutes after take-off on Sunday, killing all 157 people on board, raising questions about the safety of the Boeing 737 MAX 8, a new model that also crashed in Indonesia in October.
While the initial insurance payments will be made by Ethiopian Airlines’ insurers, they may look to recoup their money from Boeing’s insurers if they can prove that the aircraft was faulty, the sources said.
Initial payments to the passengers’ families are bound by the Warsaw and Montreal conventions, but those payouts could be much higher if families pursue legal claims, particularly through U.S. courts, said Clive Garner, head of law firm Irwin Mitchell’s travel litigation group in London.
“If there were to be anything defective in terms of the plane or any of its components, then it would be possible to bring a claim against the manufacturer as well as the airline,” he added.
Insurers typically form a consortium to share the risks of large claims, with the lead insurer taking a larger proportion of the risk. The insured value of the plane itself was likely around $50 million, according to industry sources.

Loading...

SEE ALSO :Ethiopia flight ‘had unstable vertical speed’ – Flightradar24

Willis Towers Watson was the insurance broker for Ethiopian Airlines, while Chubb was the lead insurer, a Willis spokeswoman said on Monday. A Chubb spokesman declined to comment.
Britain’s Global Aerospace was the lead insurer for Boeing and also for Lion Air, which operated the plane that crashed in October, said Global Aerospace Chief Executive Nick Brown.
Marsh was Boeing’s insurance broker, two sources told Reuters. None of the sources gave financial details of the policies.
Boeing shares fell 5.6 percent on Monday.
US LAWSUITS POSSIBLE

SEE ALSO :Eight Chinese among the casualties in crashed Ethiopian Airlines

Boeing self-insures an initial layer of coverage before the Global Aerospace coverage kicks in, said Justin Green, a New York-based aviation lawyer who has represented families in cases against Boeing. Boeing declined to comment on its insurance cover.
It is not uncommon for the planemaker, which is headquartered in Chicago, to face lawsuits in the United States, where legal compensation payments for the crash victims could run around Sh200 million ($2 million) to Sh300million ($3 million) per person, depending on the law applied, compared to about Sh20 million ($200,000) in Ethiopia, said Green.
U.S. courts often throw out such lawsuits, given the difficulty of finding witnesses overseas, but the fact that eight U.S. citizens were killed in the Ethiopian Airlines crash increases the likelihood that litigation on behalf of all victims’ families could be heard by a U.S. court, Green said.
Initial compensation costs for all 157 passengers who died on the flight could be around Sh2.5 billion ($25 million), according to Reuters calculations based on the terms of the Montreal convention.
The Montreal convention provides for a maximum of 113,100 special drawing rights, currently worth $1.39, for death or injury of each passenger, although not all countries are joined up to the convention.

Ethiopian AirlineBoeing



[ad_2]

Loading...
Continue Reading

Business

Kenya to import mitumba after coronavirus pandemic

Published

on

Loading...
LUKE ANAMI

By LUKE ANAMI
More by this Author

Kenya is set to lift the ban on imports of second-hand clothes once the Covid-19 pandemic is over, the Industry, Trade and Co-operatives Cabinet Secretary Betty Maina has said.

The Cabinet Secretary last Wednesday announced an immediate temporary suspension of the importation of second-hand clothes as a measure to stop importing the SARs-Cov-2 virus that causes Covid-19 disease.

Ms Maina said the action taken is in line with the conditions as set out by the Kenya Bureau of Standards (Kebs).

“The government has suspended importation of second-hand clothes with immediate effect to safeguard the health of Kenyans and promote local textiles in the wake of coronavirus,” said Ms Maina.

Loading...

“Most of the Mitumba imports come from China and Pakistan, countries which are the epicentre of the coronavirus pandemic. The decision is intended to safeguard Kenyans against the spreading of the coronavirus and is therefore a health issue,” she said.

In an interview with the The EastAfrican, Ms Maina said the Kebs will enforce the suspension as we wait for the situation to improve.

Advertisement

“It is a requirement by the Kebs to take such an action in times of an epidemic like the Covid-19,” she said.

A recent study by the US Centres for Disease Control and Prevention shows that the virus can stay longer on different surfaces, including clothes.

Ms Maina, however, said the temporary ban will not in any way affect the policy on Mitumba imports from the US.

Under the African Growth and Opportunity Act, Kenya sold about Ksh40 billion ($400m) worth of textiles and clothing to the US.

“This does not in any way affect our policy on our imports from the US. The decision is strictly an urgent measure to curb the spread of the coronavirus,” added Ms Maina.

Loading...
Continue Reading

Business

World Bank pushes G-20 to extend debt relief to 2021

Published

on

Loading...

World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.

“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.

He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.

The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.

Loading...

People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.

For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.

Debt burdens, already unsustainable for many countries, are rising to crisis levels.

“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

Loading...
Continue Reading

Business

Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

Published

on

Loading...

The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.

“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”

According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.

Loading...

Tighter Reins on Platforms for Mobile Loans

The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.

Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.

Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

Loading...
Continue Reading

Trending