HC Deb 17 December 2001 vol 377 cc32-3W
John Barrett

To ask the Chancellor of the Exchequer how much money has been given to each airline to underwrite their third party war risk insurance. [22964]

Mr. Andrew Smith

The Government have not given money to UK airlines to underwrite their third party war risk insurance. The scheme set up by the Government on 24 September provides cover to fill the gap in the market; airlines are offered insurance above that which is currently available in the market up to the level at which they were insured before the terrorist attacks on the US.

Airlines and aviation service providers are charged a commercially based premium for cover under the scheme, although for the first month of the scheme charges were waived for airlines in recognition of the particular financial difficulties they faced in the immediate aftermath of 11 September. Premiums charged to airlines and service providers are in line with European guidelines.

Before 11 September, war and terrorism insurance was included in the premium for the airlines' primary policy. The airlines still hold this: the premiums charged for Government insurance are over and above the premiums for the primary policy.