Aviation insurance premiums projected to hit highest level in two decades

A new report from insurance provider Allianz Commercial indicates that gross written insurance premiums for the aviation sector are projected to reach a 20-year high of more than $8 billion in 2024.

According to the insurance provider, airlines will contribute approximately 35 percent of the premiums, while general aviation is expected to account for 47 percent. Allianz attributes the surge in premiums to anticipated record-high air traffic in 2024, which is expected to grow by 10.4 percent year over year, driven predominantly by the Asia-Pacific and North American regions.

The report highlights that most of the value in aviation insurance claims comes from collisions, crashes, and issues with defective products, which together account for 85 percent of total claims. Contributing factors to rising premiums include an increase in aircraft repair costs due to higher labor rates, increased prices for aircraft parts, and inflation.