Total loss only and Unrealised Equity Protection

When entering into a lease contract with an airline, the lessee undertakes to insure the Hull value of the aircraft for pre-determined amounts throughout the lease period. These obligations, usually found within the stipulated loss schedule, fix the maximum amount for which the lessee is obliged to insure the aircraft. During the period of the lease the aircraft may increase in value or may be sold to another lessor, with the benefit of the lease attached.

These eventualities often create a situation where the aircraft is worth more than the amount of hull coverage that the lessee provides under the lessee's airline insurance programme. In these circumstances AMS can provide a 24 hour turn around on Total Loss only Insurance (TLO) to cover the unrealised equity or value increase which the lessor has built in the aircraft.

TLO can be used to cover any unwind costs and the loss of tax benefits which may result from the destruction of the aircraft.

For more information please contact broker@amspitman.com. or download the proposal form (Word .doc).