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World's Largest Aircraft Owner Claims Over $1 Billion in Insurance for Jets in Russia
The world's largest aircraft lessor, AerCap, can claim over $1 billion in insurance for jets held up in Russia, the London High Court has ruled. Details of the lawsuit and losses.
World's Largest Aircraft Owner Claims Over $1 Billion in Insurance for Jets in Russia
The world's largest aircraft rental company, AerCap, may seek more than $1 billion back in connection with jets stuck in Russia since Ukraine's invasion. The High Court in London made a corresponding judgment on Wednesday, although the company had originally demanded around $2 billion.
Court ruling in favor of leasing companies
In a larger case, the court ruled in favor of the leasing companies in a multibillion-dollar legal dispute with insurers. This mammoth trial is one of the largest insurance disputes ever heard in London and ended in February.
Background of the lawsuit
The lawsuit involved nearly 150 jets and some engines that previously had a combined value of up to $4.7 billion. However, agreements reached at the start of the trial in October have already reduced the numbers.
Judge's verdict and determination of loss
Judge Christopher Butcher said in his sentencing summary that the aircraft are considered lost and that loss occurred on March 10, 2022, when a law in Russia banned the export of aircraft and aircraft equipment from the country.
Insurance coverage and legal framework
This meant that the leasing companies could reclaim the lost money from their "war insurance insurers," instead of a broader all-risks clause, because the cause of the loss was "an act or order of the Russian government," Butcher continued.
EU and US sanctions
The judge also noted that EU or US sanctions do not prevent insurers from compensating plaintiffs for the loss of aircraft leased to Russian airlines.
AerCap's success
Herbert Smith Freehills Kramer, the law firm representing AerCap, said the ruling secured $1.035 billion for AerCap, "in addition to significant recoveries achieved in previous settlements."
Previous agreements
Butcher said in his ruling that between August and December 2023, AerCap received over $1.3 billion from six settlements with lessees and a Russian insurance company.
Leading companies and insurers
AerCap, Dubai Aerospace Enterprise, Merx Aviation, KDAC Aviation Finance, Falcon and Genesis led the claims against a range of insurers, including AIG, Lloyd's, Chubb and Swiss Re. KDAC settled all of its claims during the process, while AerCap, DAE and other landlords have regularly announced partial settlements.