Air China

Airline crash payouts to rise

PUBLISHED : Thursday, 02 March, 2006, 12:00am
UPDATED : Thursday, 02 March, 2006, 12:00am


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Payouts are set to rise for people involved in mainland air crashes under new civil aviation compensation regulations.

The General Administration for Civil Aviation of China (CAAC) said on its website the 70,000 yuan ceiling introduced in 1993 would rise to 400,000 yuan under new regulations starting on March 28.

The changes will apply to all mainland carriers and amounts decided on an individual basis.

The maximum payout for damaged carry-on baggage will also rise to 3,000 yuan, while compensation for checked luggage and cargo will increase to 100 yuan per kg.

CAAC policy and law department head Yuan Yaohui said the 400,000 yuan limit was 30 times the per capita net income of urban residents last year, plus funeral fees. The amount also included coverage of travel expenses for victims' relatives.

He said the move was designed to safeguard passengers' interests but they also had to consider the airlines' capacity to pay.

'If the compensation limit is too low, passengers' interests will be violated. If the limit is too high, airlines will find it to be an excessive burden,' Mr Yuan said.

He said the higher limit only applied to domestic air transport and the increased compensation would not affect any extra insurance passengers purchased.

The new limit is still much lower than the international standard of US$2.02 million per victim, but Mr Yuan said overseas passengers usually had higher incomes and paid more for their tickets than domestic travellers.

Shenzhen Airline official Hou Bin said the higher ceiling would increase the potential operating costs of domestic airlines, but it was not expected to lead immediately to higher fares.

Family members of 21 people killed in 2004 in a China Eastern Airlines plane crash in Baotou , Inner Mongolia , sued the CAAC last year in a US court, claiming the authority committed administrative malfeasance by not revising its casualty compensation regulations for more than a decade.

A decision has not been handed down in the case, but lawyers acting for the applicants said their clients could be awarded millions if successful.