Marsh has announced the launch of a non-payment insurance product designed for banks and investors funding new aircraft purchases from Boeing.

Aircraft Finance Insurance Consortium (AFIC) will be available exclusively though Marsh. The product is underwritten by four global insurance companies: Allianz, AXIS Capital, Sompo International (formerly Endurance) and Fidelis. According to Marsh, the AFIC structure has already been used to support a major international airline in its financing of new Boeing 747 and 787 aeroplanes.

AFIC utilises insurance to protect lenders’ exposure to default for the duration of the loan on the aircraft, according to Marsh. The terms of the insurance can be modified for individual purchase agreements between Boeing, the airline purchasing the craft, and the financiers.

“We believe that AFIC is a significant development in airline financing globally, and will contribute to the growth and diversification of aircraft finance,” said Bruce Fine, global leader of AFIC for Marsh. “AFIC offers Boeing customers a wider range of financing options to facilitate the purchase of newer, more efficient aircraft to enhance their fleets, and the lender will be able to conduct new transactions with greater confidence.”


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