Global transport chiefs will next month be asked to back the world's biggest insurance deal.
A blueprint to create a single company providing cover for the world's aviation industr ...
Global transport chiefs will next month be asked to back the world's biggest insurance deal.
A blueprint to create a single company providing cover for the world's aviation industry will await government approval between 6 and 8 March.
Governments will be asked to approve the global company scheme at a meeting of the International Civil Aviation Organisation (ICAO) in Montreal.
The world's airlines and the three biggest brokers are lobbying 187 national governments that would act as reinsurers or lenders of last resort in the event of a huge loss such as that caused by the 11 September hijackings.
That security would let the global company offer war and terrorism liability cover underpinned by a guarantee that it would not be cancelled.
It was the cancellation of war risk cover after 11 September that threatened to ground the world's air fleet and triggered an international crisis in aviation insurance.
Governments would be required to pay out only if a loss were so big that it could not be covered by money amassed from premiums. They would be repaid later.
John Palmer-Brown, chairman of the Aviation Executive of the London Market Brokers' Committee will present the plan on behalf of London market brokers to ICAO.
He said: "The only form of notice would be a 30-day notice to change the premiums."
Pricing is still being discussed but a surcharge of 50 cents a passenger would generate premium income of £850m a year.
Palmer-Brown said commercial insurers could return to the war and terrorism risk market if they wanted to.
"Traditional insurance companies will be left where they are now - they will continue to provide hull and liability coverage as they have done.
"But there would be steps built in for them to come back."
Insurers could also sell reinsurance to the global company.
The company would be based either in London or New York.
The plan has the backing of the International Air Transport Association (IATA), which represents 280 airlines together carrying more than 95% of the world's passengers and freight.
Despite intensive lobbying this month, governments may be reluctant to extend their support until the global insurance company is up and running.
