Lloyds of London Settles Air Philippines Crash Suits for Record $165 Million

By Aaron Poehler

Published on March 20, 2008

AAR and Fleet, the lessors of the 22-year old Boeing 737 involved in the crash, were accused of supplying Air Philippines with a deteriorated aircraft in need of near-constant maintenance, which the airline was unable to provide. The plane crashed into the side of a hill while preparing to land at Davao airport April 19, 2000; all 131 passengers and crew aboard were killed in the accident.

Though the Philippine government released four separate reports about the incident, the precise cause of the crash has not been determined, and independent investigators were unable to examine the aircraft due to the airline and insurers’ decision to bury the wreckage in concrete following the Philippine government’s investigation.

Under the terms of the settlement reached by victims’ families’ attorneys and Lloyds of London, neither AAR, Fleet – now owned by Bank of America – Air Philippines, nor the insurers admitted responsibility for the crash. Each victim’s family will receive more than $1 million after legal fees are subtracted from the award.

The $165 million settlement is said to be the largest settlement ever reached in an Asian airline accident.

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