American International Group (AIG) has urged the US government to stop covering airlines for third party war risks. It believes there is capacity available in the private insurance market to cover them.
The Federal Aviation Administration (FAA) started providing cover soon after 11 September. AIG has argued that it no longer needs to and said that if the FAA left the market between $1.5bn and $2bn of commercial coverage would become available.
AIG is encouraging the FAA to announce the date it will exit the market so that private market capacity will be encouraged to return.
