Leasing company pursues $80 million claim for aircraft lost in Russia
Leasing company pursues $80 million claim for aircraft lost in Russia | Insurance Business America
Insurance News
Leasing company pursues $80 million claim for aircraft lost in Russia
Firm is suing reinsurers despite never having seen the relevant policy documents
Insurance News
By
Ryan Smith
An aircraft leasing company is pursuing an $80 million claim for commercial airplanes lost in Russia following the invasion of Ukraine, despite the claimant never having seen the relevant policy documents.
Shearwater Aircraft Leasing made the claim, which relates to the loss of two commercial aircraft it had leased to Russian aviation group Norwind, according to a report by UK insurance broker Mactavish. Norwind failed to return the aircraft when the Ukraine war began and has continued to use them despite Shearwater’s repeated attempts to have them returned – a practice common with many Russian airlines, Mactavish said.
In a legal claim against the insurers, Shearwater is suing for what it says is a total loss of the aircraft, claiming that Norwind’s retention of the aircraft has led to their effective loss.
“Norwind has continued to operate and fly each of the aircraft in and across Russia, contrary to the demands and/or instructions of the claimants, and despite the fact that the BCAA Certificates for each of the aircraft has been withdrawn and/or revoked and/or that the leasing of each of the aircraft has been terminated,” Norwind’s claim document said.
Defense documents have not yet been filed in the case, according to Mactavish. However, insurers have refused to pay out in similar cases, arguing that the claims of total loss are invalid since the aircraft still exist.
There are more than 20 cases currently moving through the courts related to unpaid claims for aircraft lost in Russia, Mactavish reported.
The unusual thing about this case is that Shearwater is suing related to an insurance policy taken out by its client, Norwind, which is still using the aircraft. And instead of suing Norwind or the primary insurers, all of which are Russian and subject to sanctions, Shearwater is suing the reinsurers. Shearwater said in its filings that it has never been provided with copies of the insurance policies for the aircraft.
Mactavish said that Shearwater’s case may be a long shot.
“Suing an insurer through the High Court is tricky enough in normal circumstances; costs are substantial, standard contracts are often insurer-friendly and the court process is long and laborious,” Mactavish said in a news release. “Attempting to pursue this path without even having the benefit of the full insurance contract is challenging in the extreme.”
However, Mactavish said that the number of similar cases going through the court system right now could provide a useful precedent before Shearwater’s case goes to trial.
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