1. to use the broker’s technical knowledge in evaluating the risk, assessing suitable level of liability and general advice on contractual and many other matters;
2. to take advantage of the broker’s negotiating power in the insurance market;
3. to secure the broker’s assistance in negotiating the prompt full payment of valid claims; and
4. to have available the broker’s advice day-by-day in helping deal with insurance related problems as they arise.

An airline’s insurance program will be placed in one of our international insurance markets. Each leading market will develop its own rates and may require its own wording to be used, especially for leading markets. We deal with these markets daily and are aware of their available capacity and can estimate the likely required rate. We may prepare the policy wording and the policy documents, then collect the premium and pay insurers.

War and cargo risks will be placed separately and often with different markets. Non-marine covers are separate from the aviation covers and in some countries may be placed direct with local insurers by the airline.

For a new account, we will become involved in a detailed review of the client’s needs and its current program and placings.

Substantial detailed investigation will be required by reviewing:

Passenger and freight volumes;

The route structure;

The airline’s operations with careful attention to any peripheral activities and any special situations;

The airline’s detailed loss experience over many years; and

Any expected changes in equipment and operations.

This work will usually be carried out in conjunction with the airline insurance manager and his staff, with meetings with other airline insurance executives as appropriate. In some cases a separate fee may be required for this work.

When appointed, we position ourselves to approach the various insurance markets, with on-going involvement from the airline when appropriate. The markets to be used will often have been discussed with the airline. As the choice of lead is very important, we will visit the main markets to discuss their underwriting approach and any special wording needs. The selection of leader will have a big impact on achieving the required rate in approaching other markets. Major markets overseas are in Great Britain, France, Italy, Sweden, Germany and the Gulf, providing about a dozen separate leaders who will quote their own rate.

For the bigger risks there is a sizeable following market, with each underwriter generally being prepared to follow leaders he respects, but most markets have their own preferences and underwriting philosophy.

Local regulations in some countries provide for insurance to be placed only locally. Here our role will involve the arranging of a facultative reinsurance with world markets. Reinsurers in these cases are able to influence strongly or even dictate original placing terms.

For a major airline there is constant change with a regular flow of contracts for new aircraft purchase or leasing, and for provision of airport or other services which are reviewed in the airline’s legal and insurance departments. We are often consulted on any insurance implications which will often mean further negotiation or discussion with insurers.

Traditionally, we are remunerated by commission from the insurers. This will vary with the level of premium and has to cover all of our work. Sometimes airlines pay an agreed fee, taking the place of commission which is then directly rebated to the client.

In this competitive market, we:

Understand the total spectrum of their clients’ risk exposures;

Are able to think and act strategically to help our clients develop financially and fiscally effective insurance risk and management programs;

Use a blend of insurance, financial and capital market techniques to achieve optimum results; focus on our clients’ profitability by understanding the dynamics of the clients’ industry, its market place and where appropriate assist clients to generate revenue;

There is a lot more to involvement in the airline insurance business than finding an underwriter who will quote a competitive price. It is only possible to provide the level of service required by employing a widely qualified team, with a depth of experience and expertise in all disciplines.