In the first week of March 2022, a leasing executive in Dublin watched flight trackers the way other people watch a stock ticker. The aircraft on the screen were not his to fly. They were his to own — or rather, they had been. One by one, the dots that should have been returning to lessors in Ireland and Bermuda were staying put on Russian ramps, and the sanctions that were supposed to force their return were colliding with a Russian export ban that made return illegal. The planes were not crashed. They were not stolen in the ordinary sense. They were simply gone, in the way that matters to an insurer: permanently beyond the owner's reach.
That week became the largest aviation insurance loss in history. More than 400 leased aircraft and related equipment were stranded in Russia, with an initial estimated value of up to $12 billion. For comparison, the total aviation liability losses after the September 11 attacks were estimated at about $2 billion. A single political event had produced a loss roughly six times that size, and it had done so without a single hull being damaged.
The legal fight that followed took more than three years to reach a judgment. On June 11, 2025, Mr Justice Butcher of the English High Court ruled in AerCap Ireland Ltd v AIG Europe SA & Ors, the Russian Aircraft Lessor Policy Claims case, after a trial that ran for ten to twelve weeks. The claims before the court covered 147 aircraft and 16 standalone engines leased to 18 Russian airlines, including Aeroflot, with a combined insured value of more than $4.5 billion. The claimants — AerCap, DAE Capital, Merx Aviation Finance, Falcon 2019-1 Aircraft 3 Limited, and Genesis Leasing — won. The judge held that the aircraft were lost on March 10, 2022, the day Russian Government Resolution 311 banned the export of aircraft and equipment, and that the loss fell under the war-risk cover's government-perils section, as a restraint or detention by a government. It was not, the court held, an all-risks loss.
The distinction mattered in dollars, not just in doctrine. AerCap, the largest claimant with 116 aircraft and 15 engines in the case, had argued the loss was an all-risks one — because its war-risk cover carried a $1.2 billion aggregate limit against a total loss of about $2.1 billion. The court disagreed, and the war-risk limit stood. Settlements reached during the proceedings had already reduced the claims in the judgment to around $3 billion, and AerCap said it was due a $1 billion payout by July 2, 2025, in addition to prior settlements. The ruling did not award damages itself; it opened the door to the claims. A separate trial over the Russian operators' own policies was set for autumn 2026.
Here is the part the market has not fully absorbed. Aviation insurance is priced, in large part, on metal and weather: hull values, accident rates, repair costs, pilot training. The Russia loss was priced on none of those. It was priced on a line of policy wording — contingent cover versus possessed cover, war risk versus all risk, the precise date a government resolution took effect — and on a concentration nobody had measured properly: hundreds of aircraft, owned by a handful of lessors, leased to airlines in a single country, all exposed to the same political decision at the same moment. The underwriting question was never whether a plane would crash. It was whether a country would keep it.
That is a different kind of risk, and it does not go away because the court ruled. The insurers in the case — AIG, Lloyd's syndicates, Chubb, and Swiss Re among them — now know that war-risk aggregate limits can be the binding constraint on a loss of this size, and that lessors will read those limits with new attention at the next renewal. Lessors, in turn, know that their contingent cover responds only if the wording is right, and that the difference between a $1.2 billion cap and a $2.1 billion loss is not a rounding error. It is the difference between a bad year and a balance-sheet event.
The counterargument deserves its weight. The market absorbed the loss without a systemic failure. No major aviation insurer collapsed. Rates hardened, capacity re-priced, and the London market kept writing. Some underwriters argue the Russia episode proves the system worked: the policies responded, the courts interpreted the wording, settlements were reached, and the loss was spread across insurers, reinsurers, and lessors rather than concentrated in one place. That is true, as far as it goes. It is also the argument that gets made after every large loss that does not kill the market — and it says nothing about the next concentration, which by definition will sit somewhere nobody is currently measuring.
The implication for anyone in or near aviation insurance is to price the political risk as carefully as the physical one. Ask where the aircraft are, who owns them, which government's writ they sit under, and what the policy actually pays when the loss is a resolution rather than a wreck. The Russia claims turned a clause most buyers skimmed — government perils, contingent cover, aggregate limits — into the most expensive paragraph in aviation insurance. The next buyer who skims it will be paying for the same lesson, at the next price.
Sources: WTW, “U.K. High Court Russia Ruling: Aviation insurance impact” (July 2025): more than 400 leased aircraft stranded; initial estimated value up to $12 billion; September 11 aviation liability losses about $2 billion; June 2025 judgment covering 147 aircraft, 16 engines, insured value about $4.5 billion; settlements reducing claims to around $3 billion, https://www.wtwco.com/en-be/insights/2025/07/the-aviation-insurance-implications-of-the-english-high-courts-russia-leasing-ruling. Hausfeld, “Aviation disputes legal update on the Russian aircraft lessor policy claims — lessors win”: largest aviation insurance loss in history, over 400 aircraft, value in excess of $10 billion; 147 aircraft and 16 engines leased to 18 Russian airlines including Aeroflot; insured value over $4.5 billion; loss date March 10, 2022; AerCap $1.2 billion cap against $2.1 billion loss, https://www.hausfeld.com/en-us/what-we-think/perspectives-blogs/aviation-disputes-legal-update-on-the-russian-aircraft-lessor-policy-claims-lessors-win. ch-aviation, “Lessors win $4.5bn Russia insurance case in UK court” (June 12, 2025): five lessors, AerCap 116 aircraft and 15 engines, $1 billion payout due July 2, 2025; insurers AIG, Lloyd's, Chubb, Swiss Re, https://www.ch-aviation.com/news/154900-lessors-win-45bn-russia-insurance-case-in-uk-court.