HC Deb 29 January 2002 vol 379 cc201-2W
Mr. David Stewart

To ask the Secretary of State for Transport, Local Government and the Regions what assessment he has made of the impact of the level of insurance costs imposed on the air transport industry following the events of 11 September. [31285]

Mr. Jamieson

The Government are aware that following the events of 11 September there has been a significant increase in the cost of insurance for the air transport industry. This is primarily a commercial matter, and we would expect the increased premia to be passed on to users of air transport services in the normal way.

In the case of third-party war and terrorism risks there was a market failure, with the insurance industry withdrawing cover above minimum levels in the immediate aftermath of the terrorist attacks. In response the Government intervened to guarantee levels of cover for airlines up to the amounts held prior to 11 September, with similar arrangements for airports and ground service providers. My right hon. Friend the Chief Secretary to the Treasury has recently announced that this scheme, as subsequently amended, will be carried over till 20 March 2002.