AIG Australia pullout worries aircraft owners, operators

June 5 2017 by InsuranceAsia News Staff

AIG’s closure of its business in Australia and New Zealand since May 9 has caused concern among aircraft owners and operators in those countries.

According to reports, Australia’s aircraft industry fears higher insurance premiums after AIG cut its aviation business in the country.

The insurer has reportedly told brokers it will continue to write certain components of the portfolio from its Asia-Pacific hub in Singapore where possible. Claims will still be serviced at its Singapore hub.

AIG earlier cited a strategic review of local market conditions and its portfolio for its Australia exit.

It said that while it was difficult to predict the exact impact on aviation business in the country, it believes considerable competition still exists within the insurance marketplace.

Benjamin Morgan, executive director of Aircraft Owners and Pilots Association of Australia, said AIG’s withdrawal could lessen competition.

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