WASHINGTON (CN) – The insurance payout in relation to a pair of Boeing 737 MAX aircraft crashes that claimed nearly 350 lives will likely be the largest ever, the director of S&P Global Ratings said Tuesday.
Speaking at a press conference this morning in Paris, S&P’s Marc-Philippe Juilliard described the two crashes in October and March as the “worst disaster in the history” of aviation insurance.
Juilliard said it was too early to estimate the eventual payout, as insurers and reinsurers must cover the cost of the decision to ground the planes in March.
“We will be able to talk (about the cost) when the airplanes begin to fly … but clearly that is going to cost money,” Juillard said.
Investigators are said to be probing whether a problem with the aircraft navigation caused the two aircraft crashes, both within minutes takeoff. Lion Air Flight 610 crashed in Indonesia on Oct. 29, 2018, and Ethiopian Airlines Flight 302 crashed near Bishoftu, Ethiopia, on March 10, 2019. The MCAS system, a flight-control software that prevents the plane from stalling, was reportedly malfunctioning during both flights, pushing the noses of the planes down.
Dozens of lawsuits against Boeing have been filed in relation to the crashes, as the aircraft company has been handling an internal investigation whose initial findings have caused repeated delays to the clearance date for getting the aircraft airborne again.
The earliest estimated date for the plane’s return is now December, although there is still uncertainty as the investigation continues.
Boeing has reported that total costs for the incidents and the planes’ subsequent grounding as nearing $8 billion, including a $5.6 billion cost to cover possible airline insurance claims. The company also reported a second quarter loss of nearly $3 billion, largely related to issues with the Boeing 737 MAX.
Boeing declined Tuesday to comment on the payout.