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B T P S Journal of Transport Literature JTL|RELIT Vol B T P S Journal of Transport Literature JTL|RELIT Vol. 7, n. 2, pp. 268-283, Apr. 2013 Brazilian Transportation www.transport-literature.org Planning Society Research Directory ISSN 2238-1031 Aviation war risk insurance and its impacts on US passenger aviation [Seguro aeronáutico contra risco de guerra e impactos na aviação comercial Norte Americana] Paul J. Freitas* Technology Consult, United States Submitted 8 Jun 2012; received in revised form 16 Jul 2012; accepted 4 Aug 2012 Abstract In the aftermath of the September 11 attacks, the United States government became a supplier of aviation war risk (AWR) insurance for airliners, as well as a reinsurer for commercial insurance. Here we quantitatively examine the consequences of these offerings. The AWR offering is primarily needed for widebody and jumbo jets; smaller aircraft like the Embraer 195 are far less capable of creating damage in excess of the $50 million AWR deductible. Widebody and jumbo jets are also the only aircraft capable of creating long-term government liability through its commercial reinsurance. The US government's assumed risk through its insurance involvement can reach into the hundreds of billions of dollars. This risk level can create a perceived financial incentive for government to force airline passengers through invasive and dangerous search procedures. Thus, governmental insurance offerings can create a conflict of interest that infringes air passengers' civil liberties. Key words: aviation insurance; airlines; jets; wars. Resumo Após os ataques de 11 de setembro, o governo dos Estados Unidos tornou-se um fornecedor de seguro aeronáutico contra risco de guerra (AWR) para as companhias aéreas, bem como um ressegurador de seguros comerciais. Neste artigo foram examinadas, quantitativamente, as consequências deste fornecimento. O AWR é basicamente direcionado às aeronaves de grande porte (jatos widebody e jumbo); aeronaves menores, como o Embraer 195, são menos sujeitas à sofrerem danos que excedam os $50 milhões de dólares dedutíveis pelo AWR. As aeronaves de grande porte são, também, as únicas capazes de criarem uma responsabilidade de longo prazo do governo através do seu resseguro comercial. O risco assumido pelo governo norte-americano tendo em vista o seu envolvimento com seguro pode alcançar os muitos bilhões de dólares. Este nível de risco pode criar um perceptível incentivo financeiro para que o governo force as companhias aéreas comerciais a tomarem medidas e procedimentos de segurança mais invasivos aos passageiros. Desta forma, o fornecimento do seguro governamental pode criar um conflito de interesses que infringe na liberdade civil dos usuários do transporte aéreo. Palavras-Chave: seguro aeronáutico; companhias aéreas; jato; guerras. * Email: [email protected]. Recommended Citation Freitas, P. J. (2013) Aviation war risk insurance and its impacts on US passenger aviation. Journal of Transport Literature, vol. 7, n. 2, pp. 268-283. ■ JTL|RELIT is a fully electronic, peer-reviewed, open access, international journal focused on emerging transport markets and published by BPTS - Brazilian Transport Planning Society. Website www.transport-literature.org. ISSN 2238-1031. This paper is downloadable at www.transport-literature.org/open-access. Paul J. 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