As we know COVID-19 brings severe impact as the death toll escalates day by day also hits hard to many Indonesian Airlines until grounded their fleet and ended by laying-off employees.
The Ministry of Health so far has been issued protocols to fight against the deadly virus with several ways such as flight restriction, utilization of health alert certificate, and 14 days quarantine for foreigners or Indonesian citizens who have just arrived in Indonesia.
Continues on April 1st, 2020 Minister of Law and Human Rights has response with a Temporary Prohibitions of Entry (Travel Ban) into Indonesia for Foreigners (Permenkumham No. 11 of 2020).
For some airlines which remain operate also has implemented of risk mitigation by spraying strong disinfectant on cabin, doing keep an eye out for passenger who may appear unwell or wouldn’t allow them to on board when medical condition seems poses a danger to health and safety of other person on the flight.
However, it doesn’t elucidate of further provisions related to insurance coverage for aircraft passengers and airline liability amid the current pandemic risks.
This circumstance will raise a big question for us. Does aviation insurance policy protect passenger due to COVID-19 risk?.
Aviation insurance policy and passengers legal liability
A policy that we know as contract between Insurer and Insured basically consists of 2 types of styles. First is Named Insured Perils which has details of every risk on it. Second is Unnamed Insured Perils or All Risk that doesn’t mention explicitly omit each risk. In other words is more comprehensive because it accommodates all risks other than stated on the exclusion.
A policy which owned by airline to cover aircraft and their passengers belong to the type of all risks. The oldest also the most commonly used in the world is Hull & Liability (AVN1C).
Related to passengers legal liability of airline, we could understand by refer to the Coverage Section III, Legal Liability to Passenger; which mention as follows The Insurers will indemnify the Insured in respect of all sums which the Insured shall become legally liable to pay, and shall pay, as compensatory damages in respect of; a. accidental bodily injury (fatal or otherwise) to passengers while entering, on board, or alighting from the aircraft.
In addition from international provisions Montreal Convention 1999 which regulates passengers, has explained clearly on Chapter III, Article 17 Death and Injury of passengers. Under that convention, an airline will only liable to its passenger if it is established that illness (any kind of illness including resulting from COVID-19) is cause by accident which happens on board the aircraft or in the course of embarking or disembarking.
Based on the two conditions above, in the context of insurance it can be interpreted that every incident of passenger illness due to infected with COVID-19 on a flight can be protected in aviation insurance policy up to the cost of healing as long as preceded by any accidental events as a cause of loss.
Accidental events are every unexpected thing that might occur such as passenger injured during embarkation or disembarkation, extreme turbulence on board, loss of cabin pressure, aircrew negligence causing accidents, and in-flight food poisoning.
What if passenger attacked illness directly by COVID-19 without any accident? Unfortunately, the coverage cannot kick in.
We have to remember there is also a Causa Proxima principle which means “the active and efficient cause that set in motion a train of events which brings a result without the any intervention of any force” (Pawsey v Scottish Union & National, 1907).
Insurer need to discover cautiously what the Causa Proxima is before accepted the loss of passenger and have a causal relation between possibility of loss with the loss itself.