Chandigarh, June 13 — The tragic crash of an Air India Boeing 787-8 Dreamliner shortly after take-off from Ahmedabad on Thursday afternoon has claimed the lives of 241 passengers and crew members, and could result in India’s most expensive aviation insurance claim to date. Preliminary estimates peg the potential liability between $211 million and $280 million, or roughly ₹2,400 crore.
Flight AI 171, bound for London’s Gatwick Airport, took off from Sardar Vallabhbhai Patel International Airport at 1:38 pm. Just 32 seconds later, the aircraft lost altitude and crashed in a residential area near Meghaninagar, turning into a fireball upon impact. Of the 242 people on board, only one—a British-Indian national identified as Vishwash Kumar Ramesh—survived the crash.
The aircraft was carrying 169 Indian nationals, 53 British citizens, 7 Portuguese nationals, and one Canadian passenger. The incident has not only resulted in immense human tragedy but also triggered a complex process of insurance claims and liabilities.
According to Ramaswamy Narayanan, Chairman and Managing Director of the General Insurance Corporation of India (GIC), the airline’s fleet insurance typically covers aircraft hulls, spare parts, and liabilities to passengers as well as third parties. In this case, both the hull and liability sections are expected to be activated, given the destruction of the aircraft and the significant loss of lives.
Industry experts estimate the financial claims to range between $211 million and $280 million. Amit Agarwal, CEO and Managing Director of insurance consultancy Howden India, noted that the actual valuation would depend on several factors, including the aircraft’s age and configuration. The ill-fated Dreamliner, tail number VT-ABN, was a 2013 model and had reportedly been insured for approximately $115 million in 2021. “Whether the damage is partial or total, the loss would be covered based on the value declared by the airline,” Agarwal said.
The compensation to passengers will fall under the purview of the Montreal Convention of 1999, an international treaty to which India became a signatory in 2009. According to convention, compensation is calculated in Special Drawing Rights (SDRs), currently valued at 1,28,821 SDRs, or approximately $171,000 (₹1.47 crore) per passenger.
In addition to passenger claims, liabilities arising from third-party property damage and any fatalities on the ground at the crash site will also be considered.
Meanwhile, the Tata Group, which owns Air India, has announced an ex gratia payment of ₹1 crore to the families of each deceased passenger. The announcement came hours after Prime Minister Narendra Modi visited the crash site and chaired a high-level review meeting with officials of the Gujarat government and aviation authorities.
The Directorate General of Civil Aviation (DGCA) and other investigative bodies have begun their inquiry into the cause of the crash, with early reports indicating that the aircraft’s failure to achieve lift may have contributed to the incident. Further investigations are underway to determine whether mechanical failure, human error, or external factors contributed to the tragedy.
