LONDON, 14 March, 2016 – Aon Benfield, the global reinsurance intermediary and capital advisor of Aon plc (NYSE:AON), today announces the launch of an innovative new insurance product that will help the charter aircraft industry avoid the financial losses associated with the cancellation of flights.
Structured in partnership with Mountfitchet Risk Solutions, the Aircraft On Ground (AOG) Protect product indemnifies aircraft operators for the financial loss incurred when their aircraft cannot be utilised by flight operators for a contracted charter flight, leaving the operator to sub-charter or reposition a replacement aircraft.
Traditionally, aircraft operators have had to replace the aircraft at their own cost, or have had to refund the flight, leaving passengers without an aircraft and affecting the operators’ profits and revenue. However, with AOG Protect, operators receive an insurance payout when a flight is cancelled for reasons including mechanical breakdown, accidental damage, crew sickness or even mid-flight diversions following mechanical fault.
AOG Protect will be offered to aircraft owners and operators through Mountfitchet Risk Solutions. The firm is already attracting some of the largest companies in the private jet sector, having already established links with Air Charter Service Plc (ACS), one of the world’s largest private charter brokers.
When purchasing AOG Protect, aircraft owners receive the expertise of leading global companies in the fields of reinsurance broking and reinsurance, which have combined their skills to develop a product suited to the needs of the client. Insurance capacity for the product is being provided by Swiss Re Corporate Solutions – a division of global reinsurer Swiss Re which solves the risk management and financing needs of corporations around the world.
Kurt Cripps, Managing Director of Aon Benfield’s MGA and Programme Solutions team, said: “This innovative insurance product enables aircraft owners to more accurately assess the income they will receive when leasing their aircraft to aircraft operators, and in doing so can help them to reduce any volatility in their earnings for a single aircraft or fleet of aircraft.”
Oliver Clarry-Risk, Managing Director of Mountfitchet Risk Solutions, added: “In an ever more accessible market, private aircraft are being flown more and more and so the likelihood of an AOG event is ever more present. Our product helps alleviate operators’ stress should said event occur and, of course, helps to provide them with an enhanced service to their customers, and maintain manageable operating profits.”
Martin Lawson, Senior Contingency Underwriter at Swiss Re Corporate Solutions, said: "With this unique solution, we are really focusing on the needs of the client by hedging their cash streams against events they cannot influence. This is a great example of how insurance goes beyond protecting physical assets and enables companies to grow."