Europe to end airline coverage

The European Commission has decided to withdraw support for government-backed airline coverage at the end of this month. At a meeting of the EC’s Transport Council this week it was announced the European Union would no longer offer blanket approval for state’s to backstop third-party war risk liability coverage for commercial airlines as of October 31.After that time, states may still apply individually to offer the coverage.Most countries, including Canada and the U.S. have been offering government-backed coverage in the aftermath of the September 11, 2002, terrorist attacks when the private market cancelled the coverage.Airlines have several plans in the works, including an international pool mechanism, as well as specific U.S. and European pools. However, none has actually been formally put in place, and airlines have been relying on the government backing for more than a year.In Canada, the government has been silent on renewal of coverage since the last deadline passed on September 17, 2002.The European Commission says it is still looking at a proposal for a “Eurotime” pool to see if this runs in accordance with monopoly rules. However, the Commission also says that the private market has returned sufficiently that airlines should be able to find coverage.