Claim process in MH-370 accident to begin in 48 hours: Insurance firms

• Aircraft that are lost and their debris aren't found are also covered under the 'disappearance' clause in an aviation insurance policy
   
• Insurance companies are liable to pay the full sum assured under such a policy. However, local laws apply in case a particular country is not part of global pacts for compensation for air-related accidents
   
• Once the government concerned gives an official statement on the disappearance, the claims processing begins within 48 hours
   
• Life and property losses are to be paid in full. Number of lives lost and survivors (if any) is based on the official list provided by the airline
  

 

Most countries follow the Montreal Convention of 1999, which covers norms with respect to carriage of passengers by air
 

Article 50 of the Montreal Convention says governments shall ask their carriers to maintain adequate insurance covering liability under this convention

 

More than 100 countries, including China, India and Malaysia, are party to this convention, which has provisions for loss of life and baggage
 

With respect to the air carrier liability, the Montreal Convention has established a 'two-tier' system of liability - a carrier has a liability for up to 113,100 special drawing rights (Rs 10.58 crore, or $174,020) in case of passenger death

 

The carrier might be liable to pay damages exceeding 113,100 SDRs, unless it proves the fault wasn't its, but was that of a third party
 

With respect to loss or damage to baggage, the convention limits the air carrier's liability to 1,131 SDRs (Rs 1.05 crore or $1,741.74) per passenger, irrespective of baggage weight