Lloyd's of London expects that insurers will eventually reach a settlement with aircraft lessors over claims made for hundreds of aircraft stuck in Russia, the commercial insurance market’s chairman Bruce Carnegie-Brown said on Wednesday.
Dozens of insurers, including Lloyd's, are being sued by lessors for as much as US$8bn in a series of lawsuits after leased planes were grounded in Russia following Western sanctions
These sanctions resulted in the termination of their leases, with lessors arguing that they are covered by policies against war or theft.
Lloyds of London any other insurers argue that the planes are undamaged and could be returned in due course.
"I'm sure there will ultimately be a settlement, but we've got to navigate this rather complicated decision tree," Carnegie-Brown told the Irish Independent newspaper.
Policies taken out by Lloyds only pay out "in the event that the Russians don't pay their claims", he stated, adding that there are “ongoing conversations to be had about whether those claims are going to be paid by Russian insurance companies”.
Lessors usually have larger coverage under all-risk policies than war-risk policies, and they are trying to make claims under all-risk coverage, Cargenie stated.
However, "it feels like that issue needs to be resolved sooner rather than later”.
Lloyd’s of London warned in March that the ongoing Ukraine war “will have short, medium and long-term impacts on Lloyd’s performance and balance sheet”, and was in the early stages of assessing “the full financial impact” of the crisis.