Dubai Aerospace Enterprise (DAE) has received cash insurance settlement proceeds totalling approximately US$118 million in respect of aircraft previously on lease to Aeroflot.
The settlement relates to the ongoing aviation leasehold litigation which has arisen as a result of Russia’s invasion of Ukraine – which some aviation (re)insurance commentators have suggested could eventually cost the market in the region of $1 billion.
DAE said he amount represents a settlement of its insurance claims under Aeroflot’s insurance and reinsurance policies relating to 7 aircraft and associated engines.
The insurance settlement and receipt of the settlement proceeds from NSK, a Russian insurance company, and were carried out in full compliance with all applicable sanctions regimes.
Effective upon receipt of these insurance settlement proceeds from NSK, each DAE affiliated entity involved in the leases to Aeroflot has released its claims against NSK, Aeroflot, and their international reinsurers with respect to these aircraft and engines.
Insurance settlement discussions are ongoing with respect to DAE’s claims under the insurance policies of several other Russian airlines.
However, it added that it is uncertain whether any of these discussions will result in any insurance settlement or receipt of insurance settlement proceeds and, if so, in what amount. In particular, it said, it remains uncertain whether the necessary approvals and funding to complete any such further insurance settlements can be obtained.
DAE said will continue to actively pursue its litigation in the English courts under its own insurance policies. DAE will also continue its efforts to seek to mitigate its losses in respect of its aircraft that were previously leased to other Russian airlines.
According to DAE’s action in London, the company is insured by Lloyd’s, Abu Dhabi National Insurance Company, AIG, AXIS Specialty Europe, Chubb Fidelis Insurance Ireland, Global Aerospace Underwriting Managers, Great Lakes Insurance, HDI Global Specialty, Starr Europe Insurance, and Swiss Re.