War risk insurance extension granted by Obama

airline insurance war risk policy

This coverage availability has been extended throughout 2014 for airlines by the president.

The American government coverage that provides airlines with guarantees against perils related to war and terrorism, war risk insurance, has been extended until the end of 2014 by President Obama.

This coverage has been extended for four different carriers that would have lost their protection at the end of 2013.

airline war risk insurancePresident Barack Obama has granted an extension for the airline war risk insurance for as long as one more year. He made this decision while he was on his holiday season vacation in Hawaii and the order was distributed by way of email. Among the carriers who will have their coverage continued include Virgin America Inc., as well as a Honolulu airline called Island Air that is an intra-Hawaii carrier owned by Larry Ellison, the founder of Oracle Corp.

The war risk insurance started being offered to airlines following the terrorist hijackings on September 11, 2001.

The United States government stepped in following the 9/11 attacks to make sure that airlines would be provided with a guarantee of coverage. The majority of carriers have been able to keep this protection as a result of a law that was passed in 2002, to which Congress provided an extension in a measure that funded the Federal Aviation Administration into 2014.

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Random Quotes to Remember ~ “The best investment is in the tools of one’s own trade.” – Benjamin Franklin

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However, there were four airlines that were not covered by that specific extension, including the two aforementioned carriers and two others, which were Hyannis, Massachusetts based Cape Air, and Seaborne Airlines. That carrier, based in St. Croix in the U.S. Virgin Islands, runs flights in the Virgin Islands and the Caribbean for American Airlines Group Inc. This meant that if they were to continue their coverage, they required their own order. It was this order that was issued by Obama, according to a statement that was issued by the FAA.

The Obama administration had been working on phasing out the war risk insurance. This proposal had already been put forward, along with the gradual removal of other similar programs. This phase out is not meant to start until 2015, said the Office of Management and Budget.

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