AA insures war, hijacking and terrorist risk

(HONG KONG, 11 October 2001) !V The Airport Authority (AA) announced today that it has put in place insurance cover for war, hijacking, terrorist and other risks thus ensuring the continued operation of Hong Kong International Airport (HKIA).

Insurers cancelled war and terrorist risk coverage for all airlines and airports worldwide following the 11 September hijackings and attacks in the United States. The Hong Kong SAR Government agreed to be the AA's insurer of last resort while it sought new insurance coverage.

Notwithstanding the difficult insurance market, the AA's broker Aon Hong Kong has negotiated with AIG Europe a 100 per cent standalone cover for the AA. This matches the basic insurance cover previously only available to airlines, and is believed to be one of the first of its kind for an airport operator in the current insurance market to cover security screening risks.

This insurance provides both the AA and its subsidiary Aviation Security Company (AVSECO), which is 49 per cent owned by the Government, basic insurance cover in order that HKIA can continue its position as an international aviation centre.

"It's obviously important that HKIA secures the safety of all airport users," AA Chief Executive Officer Dr David J Pang said. "This is paramount to the operations of the Airport Authority and HKIA."

Dr Pang thanked the Government for its support during the interim period and Mr Anthony Langridge, Deputy Chairman of Aon Hong Kong, who was pleased to be able to assist HKIA in the current insurance environment.

Ref. PR-589