Air India crash complicates insurance claims as both policyholders and nominees among dead

In the wake of the June 12 crash of Air India Flight AI‑171 near Ahmedabad, insurers are confronting an unusual obstacle: in numerous cases, both the policyholder and the nominated beneficiary have died in the accident.

This complex situation requires insurers to adjust traditional claim procedures, often involving succession certificates and approvals from blood relatives before settling payouts.

The Insurance Regulatory and Development Authority of India (IRDAI) has mandated that insurers fast-track these claims, even waiving formalities like FIRs and post-mortem reports when death is officially confirmed.

The regulator has instructed insurers and reinsurers to appoint nodal officers, establish help desks at Ahmedabad’s Civil Hospital, and submit weekly progress updates.

Major life and general insurers—LIC, Bajaj Allianz Life, HDFC Life, ICICI Lombard, New India Assurance, Iffco Tokio, Tata AIG, and others—have set up assistance desks on-site.

They match official victim lists with policy records and proactively reach out to families to guide them through claim procedures.

Succession complications have already emerged. LIC officials reported multiple instances where both spouses died and had nominated each other, prompting insurers to seek declarations from Class‑I heirs, such as children.

Some insurers are exploring joint declarations from multiple heirs to streamline legal clearance and expedite settlements.

Meanwhile, the general aviation insurance claim is estimated at $475 million, covering aircraft hull, engine damage, and third-party liability.

The remainer of that total is expected to come from passenger and ground casualties. Airlines had raised hull coverage by ₹100 crore in April, just weeks before the crash.

Insurance experts warn that this large-scale payout—one of the costliest in Indian aviation history—will drive up premiums for future airline coverage and harden the global reinsurance market.