By Ryan Hewlett

Jan 20 - (The Insurer) - The multi-billion-dollar London court action between some of the world’s biggest aircraft lessors and their insurers over jets stranded in Russia resumed in London on Monday, a development welcomed by aviation (re)insurers.

It comes after the 'mega-trial' – the outcome of which is expected to have far-reaching consequences for the aviation (re)insurance market – was forced to adjourn in late November last year, delaying the industry’s search for much-needed clarity on Russia-Ukraine exposures.

As first reported by The Insurer, the hearing was forced to adjourn after the trial judge, Justice Butcher, was unexpectedly required to undergo medical treatment.

The hearing – a concurrent trial of six actions brought by individual lessors including AerCap and Dubai Aerospace Enterprise (DAE) – kicked off in early October and was scheduled to last until Christmas.

The hearing – which is taking place in a so-called ‘super court’ of the Rolls Building – resumed in front of Justice Butcher this morning and is expected to run through February.

As previously reported, the present trial concerns claims for in excess of $3bn by lessor owners on their contingent and possessed (C&P) insurance policies for circa 145 aircraft on lease to Russian airlines at the time of the invasion.

These lessors bought C&P insurance to protect their fleets in circumstances where for some reason the underlying airline (re)insurance fails to respond (contingent), and when anything unfortunate happens during the repossession process (possessed).

The cases filed in London all similarly argue that aircraft leased into Russia are covered by policies against war or theft, but insurers point out the planes are undamaged and might yet be returned.

The lessors are seeking to argue that they have suffered a “total loss” as their aircraft remain trapped in Russia and have not been returned by airlines. More than 500 aircraft worth an estimated $10bn have been stranded since the invasion, according to figures from S&P.

Lawyers acting for the insurers – which include AIG, Chubb, Fidelis and Lloyd’s – are expected to argue that it is too early to determine the loss suffered by the lessors, citing the possibility that aircraft may still be recovered, should agreements be reached between the Russian and Western governments.

Insurers have also denied liability on the basis of international sanctions.

The English hearing is the second in the series of worldwide “mega-trials” on C&P claims. The first started in Dublin on 11 June last year. Many others in various US jurisdictions, including Florida, Connecticut, New York, California and Minnesota, are set to begin in 2025.

A second English trial regarding operator policy claims under Russian law is also due to be heard next year.