No. H057/02
For release June 5, 2002
GOVERNMENT OF CANADA EXTENDS INDEMNITY
FOR AIR INDUSTRY INSURANCE TO NEW ENTRANTS
OTTAWA - Transport Minister David Collenette today announced that the
Government of Canada will extend its temporary aviation war risk liability
insurance indemnity to new entrants on terms equivalent to those for existing
essential air service operators in Canada.
A new entrant is an air service operator that has started since September 11,
2001, or intends to start in the near future, the operation of an airline, the
operation of an airport, the supplying of goods or services to an airport
operator, or the provision of goods or services to the Canadian Air Transport
Security Authority or NAV CANADA.
“The Government of Canada is extending these terms to new entrants in order
to facilitate diversification and further promote competition in the Canadian
air industry,” said Mr. Collenette. “More players in the air industry means
more choices for stakeholders and Canadian travellers.”
The initial provision of an indemnity was announced September 22, 2001. The
indemnity was extended, and will expire July 19, 2002.
“We continue to follow the efforts of the International Civil Aviation
Organization, and participate in discussions to establish a multilateral
cooperative mechanism that will provide adequate protection and, most
importantly, stability in aviation war risk liability coverage,” said Mr.
Collenette.
The Government of Canada is responding, as are governments of other
countries, to the decision by international insurers to withdraw previous levels
of third-party aviation war risk liability coverage, which were available before
September 11, 2001. This indemnity program applies to Canadian air carriers,
airports, NAV CANADA, and other essential service providers, such as ground
handlers and re-fuellers. As a general rule, coverage up to US$50 million is
available from the commercial market.
“Our intervention in the insurance market is only temporary; we will
continue to participate in discussions with other countries and the industry to
help find a permanent solution,” added Mr. Collenette.
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Contact: Anthony Polci
Director of Communications
Office of the Minister, Ottawa
(613) 991-0700
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