The fact that the Montreal Convention became effective for India on June 30, 2009 now holds the key to the kind of compensation that is made available to the families of the 158 passengers killed in Saturday?s air crash at Mangalore airport.
But with almost all of the compensation to come from Air India?s insurers?who are expected to contest the claims?there are concerns over the quantum of compensation that is eventually awarded and the time period in which it is finally delivered to the claimants.
Air India is insured by a consortium of four companies?Reliance General, Bajaj Allianz, HDFC Ergo, and Iffco Tokio. A team of insurers visited the site of the crash on Sunday to examine and evaluate the damage. Sources in the government said it would be highly optimistic to expect the insurance companies to pay compensations as laid down in the Montreal Convention without contesting the claims.
Article 21 of the Montreal Convention limits the liability of an airline at 1,00,000 Special Drawing Rights (SDR) in case of death or bodily injury sustained during an accident on board the aircraft or in the course of any of the operations of embarking and disembarking. The Montreal Convention states that the value of a national currency, in terms of the SDR, of a State Party which is a Member of the International Monetary Fund, shall be calculated in accordance with the method of valuation applied by the IMF for its operations and transactions.
Union civil aviation minister Praful Patel has said that the families of the victims could get up to $1,60,000 (over Rs 73 lakh as per current rates). However, officials point out that 1,00,000 SDR and $1,60,000 are the upper limits of the compensation that can be awarded and should not be thought of as the actual compensation to be awarded.
Before India ratified the convention—by amending some provisions of the carriage by Air Act, 1972?the maximum compensation that could be awarded for death or bodily injury was approximately $ 20,000 (around Rs 9 lakh). Armed with the Montreal Convention, the government hopes to secure as high a compensation as possible under the given limit of 1,00,000 SDR. While pushing for its ratification, Patel had argued that the Montreal Convention had already been ratified by 86 countries?of which 25 had direct air links with India.
?In such a situation, non-accession of the convention by India may give rise to a situation involving serious discrimination between the passengers of the same flight with regard to compensation. It is, therefore, necessary to accede to the convention,? he had told Parliament.