International Perspective on The Importance of Aircraft Hull Insurance

Abstract

Aircraft insurance plays a central role in the sustainability of international civil aviation, providing financial security for operators, creditors, and passengers alike. While liability insurance is extensively regulated through international instruments such as the Warsaw Convention 1929, the Montreal Convention 1999, the Rome Convention 1952, and regional regulations like EU Regulation 785/2004, hull insurance or the coverage protecting the aircraft itself as an asset remains entirely within the realm of private contractual practice. This article critically examines the legal framework of aviation insurance, distinguishing the treatment of liability insurance from hull insurance, and highlights the absence of binding international standards on the latter. It argues that this regulatory void produces legal uncertainty, unequal protection across jurisdictions, and systemic risks to the global aviation and financial sectors. By employing a comparative legal analysis, the article proposes the development of a new international framework under the auspices of ICAO and UNIDROIT, which should establish minimum standards for hull insurance, include coverage for extraordinary risks, and create a dedicated mechanism for cross-border dispute resolution. Integrating such provisions into the Cape Town Convention regime would ensure greater legal certainty, harmonization, and protection for all stakeholders in international aviation