Air Lease Corp. (ALC) secured a partial insurance settlement of $328.5 mn over aircraft stranded in Russia. The proceeds, received as cash, will be recorded as an insurance recovery in ALC’s financial statements for Q1 2025, according to a filing with the U.S. Securities and Exchange Commission, according to BestWire.
ALC and its subsidiaries submitted insurance claims and initiated litigation against insurers in a California court.
The claims involve a contingent and possessed insurance policy seeking to recover losses from aircraft detained in Russia. Most of the litigation remains ongoing, ALC stated.
Including the Q1 settlement, ALC has recovered $424.3 mn to date, following an initial $791 mn write-off of aircraft detained in Russia during Q1 2022. Upon receipt of proceeds, ALC and its subsidiaries released insurance claims against the settling insurers under the C&P policy.
The plaintiffs also dropped insurance claims against the settling insurers under related reinsurance policies.
This applies to litigation involving Russian airlines’ insurers and reinsurers in London and the dismissal of settling insurers from both the California and London cases.
ALC is in discussions with other insurers but has not projected the likelihood or amount of additional settlements.
Earlier, ALC secured a $64.9 mn settlement related to Russia’s JSC Siberia Airline following Russia’s invasion of Ukraine.
The company had filed suit against its aviation insurance carriers in Los Angeles County Superior Court.
According to Beinsure, Dubai Aerospace Enterprise announced $201 mn in settlements over three months related to Russian-leased aircraft. The company confirmed cash proceeds from selected insurance companies, resolving claims related to these aircraft.
DAE announced it has secured a cumulative $319 mn in cash proceeds, including a 2023 settlement involving seven aircraft.
Dubai Aerospace Enterprise (DAE) is a globally recognized aviation services corporation with two divisions: DAE Capital and DAE Engineering. Headquartered in Dubai, DAE serves over 170 airline customers in over 65 countries from its seven office locations in Dubai, Dublin, Amman, Singapore, Miami, New York, and Seattle.
The company stated it will continue litigation in English courts under its insurance policies and remains focused on mitigating losses associated with aircraft formerly leased to Russian airlines.
This development occurs amidst ongoing disputes involving over 40 aviation leasing companies, including DAE, seeking compensation for jets stranded in Russia.
London High Court has decided that the $10 bn battle between reinsurers and a host of aircraft leasing companies seeking payouts for more than 200 jets stuck in Russia should be heard in London rather than Moscow.
Judge Andrew Henshaw has stated in a written ruling that “the claimants are very unlikely to obtain a fair trial in Russia” and has thus ruled in favour of the aviation lessors and dismissed the jurisdiction challenges from the remaining contesting reinsurers.
World’s largest aircraft owners, including AerCap and Carlyle Aviation Partners, which are pursuing claims against insurers for planes stranded in Russia, are preparing to step up their fight against the cases being heard in Moscow (see What Lessons Should Be Learn the Insurance Industry After Russia’s Seizure of EU Aircrafts?).
More than 40 aviation leasing firms, locked in a battle with insurers over who should bear up to $10 bn in costs for 400 jets stuck in Russia, are urging the High Court to allow a reinsurance dispute to be heard in London, not Moscow.
Russian controlled and operated aircraft are usually insured locally in Russia and then reinsured into the London Insurance Market. Even without the news of the impending UK ban on such activities, (re)insurers would have found it difficult to continue to provide reinsurance to Russian carriers.
