Experts say the crash of a US Airways commuter flight in North Carolina will likely cost the insurance industry tens of millions of dollars, according to the Charlotte Observer, but it will probably not affect airline’s plans to emerge from bankruptcy protection. Wichita, Kan.-based Air Midwest, the regional carrier that operated Flight 5481 under an agreement with US Airways, will remain viable as well.
The Insurance Information Institute has estimated the insurance industry could face as much as $85 million in damages from the crash.
A spokesman for Mesa Air Group Inc., Air Midwest’s Phoenix-based parent company, said Air Midwest is insured by AIG. Mesa operated the aircraft under one of seven code-sharing agreements US Airways has with regional airlines. Air Midwest schedules, prices and operates the flights but US US Airways sells tickets for a share of the ticket price.
Lawyers claim the arrangement is misleading since passengers may think that US Airways is the flight operator. A US Airways spokesperson noted, however, that airlines are required to tell passengers who’s operating the airplanes regardless which company is selling the tickets. Still, aviation attorneys think US Airways will be end up being responsible for some of the damages.
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