Insurance rates may rise for Kingfisher

Insurance rates may rise for Kingfisher

New Delhi: Kingfisher Airlines Ltd, India’s second largest carrier, faces higher insurance premiums after the aviation regulator re-classified an “incident" involving one of the company’s planes as an “accident".

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A Kingfisher turboprop ATR flying from Bhavnagar to Mumbai in November 2009, with 36 passengers on board, skidded off the runway as it landed, causing extensive damage, but no loss of life. The aircraft had to be written off.

The Directorate General of Civil Aviation (DGCA) classified the event as an “incident" in its 2010 investigation report, as Mint reported on 25 November. The rules define an accident as one where “any person suffers death or serious injury" or the “aircraft receives substantial damage".

The report was withdrawn by DGCA the same day on instructions from then director general Nasim Zaidi, who had approved the accident classification, according to an official at the regulator familiar with the development.

Zaidi is currently civil aviation secretary.

DGCA has now said in the report uploaded on its website that the Kingfisher Airlines ATR-72-212-A aircraft with the call sign VT-KAC, while operating flight IT-4124, “was involved in an accident" as it skidded off runway 27A while landing at Mumbai.

The investigation also found that the flight was being operated by a pilot not qualified to land on a shortened runway and that there was a breakdown of cockpit crew resource management principles. The runway had been shortened on account of operational reasons.

A Kingfisher spokesman did not respond to emails seeking comment on the matter and any corrective action taken to avoid such incidents.

A safety expert said it was important to note DGCA’s acceptance that it had made a key error and corrected it.

“It points to total lack of commitment of propriety of the investigating officials that they can get away with anything," said Mohan Ranganathan, a Chennai-based safety expert who’s also been advising the government on safety issues following the Air India Express IX812 crash of 2010 that killed 158 people.

“The positive aspect is that they are now open to accept that there has been an error, pulling out the report and having it corrected," he said. “The recent and current DG are more open to transparent criticism."

Besides making 2009 an accident-free year for India, the earlier classification would have helped Kingfisher secure cheaper premiums on the insurance of its fleet, which is renewed every year.

Premiums could now go up by 5-10%, estimated a senior official with a domestic insurance firm who deals with the subject. He declined to be named as he’s not authorized to speak with the media.

“There are two things that re-insurers look at when deciding the premiums every year," this official said. “The fleet size of the airline and the ratio of claims made the previous year to the premium paid. If there has been an accident, it automatically triggers a rise based on that ratio."