The insurance money covers different types of damages. For example, fixing the airplane itself, which costs about $125 million, and paying for the lives lost — the passengers and others — which could be around $350 million.
All together, the total cost is much more than what the insurance companies usually pay in a year for all airplane insurance in India. A man named Ramaswamy Narayanan, who is in charge of an insurance company in India, said this might be one of the biggest insurance claims (or money paid out after an accident) in India’s history.
The insurance company, called the General Insurance Corporation of India, helps pay for damages when airplanes have accidents. They had insured the airplane involved in the crash. A really bad airplane crash happened in India, and it’s the worst one in more than ten years.
This crash caused a lot of damage and costs a lot of money — about $475 million, or roughly 39 billion Indian rupees. The crash happened in a busy part of the city of Ahmedabad and resulted in the deaths of 241 people on the plane, plus some others nearby.
Because of this huge accident, it will affect the entire airplane insurance business not just in India but all around the world. It might also make airplane insurance more expensive for airlines in India. Most insurance companies will first pay for the airplane itself, then pay for the damages caused to passengers and others, but it may take some time to settle all the claims.
Many of the insurance costs are actually handled by big international companies called reinsurers, who share the risk of these big accidents. Since most of the insurance money was passed on to these global reinsurers, they will be the ones mainly paying most of the bills. This accident will likely make airplane insurance more expensive in the future because of the large costs involved.