SUMMARY

The article from Financial Express explains how insurance payouts for air crash victims are determined.

KEY POINTS

1. Liability Under International Conventions: Payouts are governed by international agreements like the Montreal Convention (1999), which holds airlines strictly liable for passenger death or injury up to a certain limit (currently around $170,000 or 128,821 Special Drawing Rights (SDRs)). Beyond this, airlines can avoid liability only by proving the incident was not due to their negligence or was caused solely by a third party.

2. Factors Influencing Compensation: The payout amount varies based on the victim's age, income, earning potential, and the financial dependency of survivors. Courts may also consider non-economic factors like pain and suffering or loss of companionship. For instance, families of younger victims with high earning potential may receive higher compensation.

3. Insurance Coverage: Airlines are required to maintain liability insurance to cover passenger injuries or deaths. In India, the Carriage by Air Act mandates a minimum insurance cover of approximately ₹20 lakh per passenger for domestic flights, though actual payouts can be higher based on case specifics.

4. Claims Process: Families must file claims with the airline or its insurer, providing evidence like death certificates and proof of dependency. The process can be complex, often requiring legal assistance, and may involve negotiations or court proceedings if disputes arise.

5. Challenges and Variations: Compensation amounts differ across countries due to varying legal systems and economic standards. Delays in payouts can occur due to investigations into the crash cause or disputes over liability. In India, interim relief may be provided while final settlements are negotiated.

6. Recent Examples: The article cites cases like the Air India Express crash in Kozhikode (2020), where families received interim payments of ₹10 lakh, and the Ethiopian Airlines crash (2019), where payouts ranged from $1 million to $8 million depending on individual circumstances.

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