Neck-deep in loss, Air India spends $6 million to insure 6 grounded planes

National carrier Air India, which is sitting on a huge debt pile and surviving on the Rs 30,000- crore government bailout, is allegedly getting even those aircraft, which have not been in operations for some years now, insured at a cost of USD 6 million in a year. The state-run airline's recognised pilots union, the Indian Commercial Pilots Association (ICPA), has sought an independent probe into these allegations and fix the accountability on individuals responsible for this.

"Six Boeing 737-200 Fs, which have been out of service for more than three years, are still being insured at USD 1 million each per annum or USD 6 million, for more than the past three years. We demand an immediate, time-bound investigation by an external agency to look into this huge financial irregularity," ICPA General Secretary Shailender Singh said in a letter to Air India Chairman Rohit Nandan.
The letter is also addressed to Aviation Minister Ashok Gajapathy Raju and the Chief Vigilance Commissioner.

The Air India spokesperson did not respond to calls. The airline had renewed its insurance on October 1 for nearly USD 29 million to cover its 132 aircraft (including the 17 of AI Express and 8 of Alliance Air,) which was close to 18 per cent higher than it what it paid last year, USD 23 million. Airline insurance premia had gone up this year after a string of tragedies across the globe.

Alleging that even as recent as on October 1, the insurance cover for four of these aircraft was renewed for another year at USD 50,000 each, the ICPA said, "We are also alarmed at the sharp 95 per cent drop in the insured sum of these aircraft, which till September 30 were insured for USD 10,00,000 and now only for USD 50,000."