Presented By Mr.Vijay Thakur

Contents Airline Hull All Risks and Liability Market Capacity Airline Hull Deductible Market AVN52E and Excess Third Party War Risks Hull War Risks Cover Summary

Airline Insurance Industry Cycle: Airline Hull/Liability Premiums Hard Soft Hard Soft Hard

World Airline Premium and Claims

Maximum Limit Progression

2009 Airline Premium & Rate Movements

2010 Airline Premium & Rate Movements

Losses Awards and minor claim levels are constantly increasing Recent passenger liability awards have been influenced by US lawyers and jurisdiction This has meant awards exceeding US$1m per passenger in countries where they would have previously been substantially less Increases in minor losses are also having a significant impact on underwriters bottom line

2009/10 Airline Losses: Nett Hull losses in Excess of US$10m Shown Total Hull/Liability Losses 2009 (including minor losses) – US$2.343bn 2010 (including minor losses) – US$0.733bn US Airways ($40m) Colgan Air ($19m) THY ($47m) Lion Air ($28m) FedEx Royal Air Maroc ($10m) Air France ($93m) Yemenia ($34m) Bangkok Airways ($15m) Air India ($17m & $50m) Saudi Arabian ($19m & $14.3) Emirates ($19m) Kingfisher ($18m) Avient ($67m) American Airlines ($28m) Ethiopian Airlines ($39m) 2009 Losses 2010 Losses Afriqiyah Airways ($123m) Satena ($18m)

Five Year Premium and Claims by Region(based on declared figures for 2009 renew als)

Five year Loss Ratios by Region (based on declared figures for 2009 renewals)

Airline Capacity to Accept Airline Risk: Non-US Airline with a US$1.5 Billion Limit Munich Re (10%) GAUM (7.5%) Inter Hannover (5%) Partner Re. (3.5%) Generali (1%) Aspen (3.3%) Inter Aero (2.5%) SCOR (1.5%) LRA (13%) Asia Capital (5%) KRIC (2%) Maxs Re (4%) Sirius (1.5%) Aviabel (1%) ADNIC (0.1%) GIC, Ironshore (5%) Glacier Re (3%) MISR (1.25%) PICC, New India (1%) Oriental, (0.75%) Nissay (0.15% It should be noted that underwriters are unlikely to participate up to their maximum capacity. The actual available capacity is dependant on a number of variables and underwriters desire to participate on any particular risk. Chartis (12.5%) Ace, Catlin, Swiss Re (10%) Mitsui (6%) Amlin, Starr, Talbot, XL (5%) QBE (4%) Faraday, (3%) Antares, St Paul (2.5%) Atrium (2%) Kiln, Samsung (1.5%) Axis (1%) Allianz (10%) AXA (8%) Tokio (1.5%) SCR (0.50%) Oman (2.5%)

Aviation Hull Deductible Market Talbot and Kiln have recently entered the deductible market Rating is reasonably stable Very loss active (large number of claims but restricted limits) Marginally profitable area to some underwriters All markets write 100% of any individual risk St Paul HCC Secondary Markets Principal Markets ACEAspenChartisAllianzKilnTalbotTravelers XL Insurance

Excess AVN52: Third Party Liability Premiums are now at their lowest level since the introduction of this cover and reductions are now minimal Premium levels are significantly short of the maximum insured limits Limits of US$1 billion or more being covered for an estimated total market premium of around US$200 million in 2009 The Excess AVN52 market has yet to suffer an insurable loss The market created in the wake of 9/11 has had the largest percentage fall in premium levels since the highs of 2002 An influx of capacity and competition has driven premiums down from US$1.5 billion in 2002 Some hull and liability underwriters are evidencing appetite to increase sub-limits to US$250m

Excess AVN52: Third Party Liability An influx of capacity and competition has driven premiums down from US$1.5 billion in 2002 to US$120 million in 2008 The trend for premium reductions continued during 2009 Premiums are now at their lowest level since the introduction of this cover and reductions are minimal

Excess AVN52E Capacity: Based on US$850m excess US$150m Allianz (10%) Inter Hannover (10%) Aspen (2.5%) Liberty Mutual (2%) Ironshore (10%) Glacier (5%) It should be noted that underwriters are unlikely to participate up to their maximum capacity. The actual available capacity is dependant on a number of variables and underwriters desire to participate on any particular risk. Axis (30%) Chartis (25%) Swiss Re (20%) Catlin, Starr (10%) Brit (3%) Antares (2.5%) Aegis, Amlin, Liberty (2%) ARK (1.75%) Atrium, Faraday, Hiscox, Pritchard, Markel, Talbot, XL (1.5%) St Paul (1.25%) ACE, Hardy, Watkin (1%) Kiln (0.6%) 2009 Plus Berkshire Hathaway (AAA) capable of writing US$1,000m

Aviation underwriting-Reinsurance Underwriting factors Debit credit balance Government policies Dgca Airworthiness CVC Flight data digital recorder Public knowledge of all losses

September 11 Crash

Mangalore crash

Hudson Crash