Full capacity: Aviation insurance market faces perfect storm

June 14 2025 by

Welcome to Full Capacity, a weekly briefing on all the most important developments of the past week with a personal take on the news from our editor-in-chief, Mithun Varkey, delivered to your inbox every Saturday.

Leadership change. Specialty (re)insurer Markel International has named Sucheng Chang as the successor to Christian Stobbs, who is returning to London.

Meanwhile, InsuranceAsia News exclusively reported that Axa’s Chelsea Jiang will join the insurer as its greater China CEO.

IAN exclusive. M&A specialist MGA RiskPoint appointed AIG’s George Blackborow as head of W&I in Asia, IAN reported exclusively. Blackborow will report to Maria Steeples, managing director and head of M&A for Asia Pacific.

Plain sailing. The marine MGA market in Asia Pacific is busy charting its course. This week, Allianz Commercial partnered with Hydor to provide quotes and bind marine liability insurance policies and related coverages in APAC. This follows last week’s announcement by Rokstone that it is opening an office in Singapore.

Clean bill of health. In our continuing coverage of specialty lines in the region, we did a temperature check on the region’s medical malpractice insurance market.

The healthcare market in Asia is projected to reach US$5 trillion by 2030, contributing 40% to global growth. The growth is a shot in the arm for medical malpractice insurance in the region.

Asia’s benign litigation activity and quantum of losses relative to Western countries, along with an albeit short-lived hard market arising from the pandemic, have attracted more insurance capacity to the region.

However, rates have returned to pre-pandemic levels. However, the markets continue to see new carriers, especially MGAs and insurance intermediaries, enter the space.

Brace, brace, brace

It has been a woeful week for the global insurance aviation market. Reeling from the London High Court’s ruling on the aircraft stranded in Russia, the world was further shaken by the tragic crash of Air India’s London-bound Boeing 787-8 Dreamliner in India.

As the toll of casualties continues to rise, we learn that Iran and Iraq have closed their airspace, leading to a cascade of flight cancellations, delays, and diversions.

For aviation insurers, the financial repercussions are mounting, heralding potential pricing and capacity pressures in a market that has, until now, enjoyed robust results and ample capacity.

WTW, in its Q1 Airline Insurance Market Renewal Outlook, highlighted that disputes over leased aircraft seized amid the Russia-Ukraine crisis could funnel claims into the reinsurance market.

This scenario portends a tightening of capacity, narrowing options for buyers and suggesting a significant shift in market dynamics as we move through 2025.

With a handful of reinsurance renewals set to unfold in the second quarter, this period may serve as a critical juncture for insights into the shifting tides of the reinsurance market.

Gallagher Specialty’s April report, Plane Talking, underscored the aviation insurance sector’s recent struggles, marred by a series of costly major losses, including incidents in general aviation that are typically covered by airline insurers as part of their broader portfolios.

The rapid accumulation of these losses is placing immense pressure on insurers from both senior management and capital providers.

While the official reserves related to these incidents remain undetermined, estimates suggest that the combined claims could approach, or even rival, the total annual premium for the airline class in 2024.

Swiss Re had exited the aviation market earlier this year. Though it didn’t materially dampen capacity levels at the time, given the stature of Swiss Re, it is not unimaginable that others are also revisiting their exposures.

Fidelis, which has said that it is considering appeals against the London High Court Order as it “respectfully disagrees with the ruling”, had said earlier that material rate increases were needed in the aviation sector, without which it might reassess its exposures.

The market stands poised to record yet another year of losses, with pure premiums lagging behind claims. For those insurers grappling with these losses, the situation is further exacerbated when factoring in expenses, reinsurance costs, and incurred but not reported (IBNR) claims.

However, the looming losses from the Air India disaster and the billion-dollar-plus hit from the lost Russian aircraft might catalyse a hardening of the market, despite earlier indications from aviation renewals showing little sign of such a shift.

The future remains uncertain, and there’s likely turbulence ahead.

People moves

In notable appointments this week, Howden Re’s Stuart Beatty has stepped back from his role as ANZ managing director, handing it over to John Philipsz.

New Zealand insurer Tower has confirmed Paul Johnston as its permanent CEO after being named interim CEO in February. Now the insurer is set to start the search for a permanent CFO to succeed Johnston.

The Shipowners’ Club announced the appointment of Jon Holmes as CEO of its Singapore branch from August 2026, with Steve Randall set to retire after 48 years of service.

To catch up on the most important appointments in the region, make sure to check out our weekly people move roundup.

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