Some of Britain's biggest insurers are at the centre of talks to avert a threat that airlines could be grounded because they lack insurance cover.
Royal & SunAlliance and CGNU underwrite Global Aerospace Underwriting Managers, the lead insurer for British Airways.
British Airways is among a group of airlines which said insurance underwriters had warned them that they would cancel cover for war liabilities from midnight on Monday.
This could force airlines to negotiate new insurance terms.
The lead insurer for Virgin Atlantic, another member of the group, is American International Group (AIG).
Tony Medniuk, chief executive of Global Aerospace, told Insurance Times last week it was time for aviation insurance rates to rise.
Referring to the terrorist attacks in the US, he said: “The pricing of airline insurance has been far too low for too long and this is probably coming as a reminder to people of the exposures that exist.”
The Financial Times reported that ministers were in emergency talks with airline executives and insurers to prevent airlines from being grounded from midnight on Monday September 24.
One of the measures being dicussed, it reported, was a scheme for the government to underwrite airlines' insurance.
