The Hindu Business Line : AI expects 35% reduction in insurance premium

New Delhi May 28 Air India expects a reduction of more than 35 per cent in the insurance premium cover that it would pay for its fleet for 2007-08, compared to $15 million it paid last year.

A clearer picture will emerge in a few days after an internal committee of the airline examines the bids received from two consortia - one led by public sector insurance companies and another formed by private sector insurance companies.

"The insurance cover would include the new aircraft joining the fleet during the year," Mr V. Thulasidas, Chairman and Managing Director, told Business Line.

"Although the final figures are not yet in, we are expecting over 35 per cent reduction in premium payout this year."

The airline, which has already received five brand new Boeing 737-800 aircraft, will receive at least three more Boeing 777 aircraft by July.

Last year, a consortium of public sector insurance companies led by New India Insurance won the mandate to provide insurance cover.

The private sector insurance companies too made an attempt to bag the contract but did not cross the technical evaluation stage mainly on account of not being able to meet the technical qualification on net worth and claim settlement, among others.

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AI expects 35% reduction in insurance premium