Aviation Insurance was first introduced in the early years of the 20th Century. It is believed that the first aviation polices were underwritten by the marine insurance Underwriting community.

Aviation insurance primarily covers the “Hull” (body of the aircraft), passenger legal liability and third party loss cover. Policy price is dependent upon a large number of variables – Aircraft value, aircraft age, aircraft type, pilot experience, operational territory, intended use and liability limit will all be considered when an underwriter sets a price.

The total premium is always made up of two primary components: the hull premium and the liability premium. Aviation insurance is mandatory, and without insurance no aircraft will ever take off. Most airlines arrange “fleet policies” to cover all aircraft they own or operate.

With the entry of several low cost airlines along with fleet expansions by existing ones and increasing corporate aircraft ownership, the Indian aviation insurance market is all set to take off in a big way.