Germanwings Disaster

Lufthansa Exonerated After Crash

Budget airline battles. Source: Handelsblatt
Whether the airline acted according to regulations when admitting the co-pilot doesn't change the fact that insurance companies will be paying, experts said.
  • Why it matters

    Why it matters

    Lufthansa fulfilled its supervisory duties before handing out the license to Andreas Lubitz, according to the LBA investigation.

  • Facts

    Facts

    • Allianz is expected to pay around €300 million ($282 million) to cover the costs of the crash.
    • Prior to the crash, Lufthansa didn’t informed the German Federal Aviation Office about the pilot’s depression.
    • A report from 2014 by the E.U. Commission re-surfaced, in which Brussels warned the German Federal Aviation Office of negligence when it comes to pilot supervision.
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    Audio

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Lufthansa met its supervisory obligations when issuing a license to Andreas Lubitz, the co-pilot who crashed the Germanwings airplane in the south of France last month, the German Federal Aviation Office, LBA, said on Thursday.

Jörg Mendel, president of the aviation authority, and Lufthansa Chief Executive Carsten Spohr met for several hours to discuss the issue before informing the media. The meeting followed an extensive investigation initiated by LBA directly after the crash.

“The fact that the LBA exonerated Lufthansa doesn’t really change the case. Everybody is expecting the insurance companies to pay,” a London-based insurance and finance expert told Handelsblatt Global Edition, requesting  anonymity because of the sensitivity of the subject.

Germany’s independent aviation authority, based in Braunschweig, is responsible for developing and maintaining aviation safety standards, as well as certifying planes and supervising licensing of pilots, among other tasks.

“The insurer doesn't want to risk negative publicity in the light of this crash.”

Insurance expert

The question of whether the airline acted according to regulations when issuing a license to the co-pilot could have been relevant from an insurance point of view, according to insurance experts.

“But in this case, it didn’t make a difference,” the expert said. “The insurer doesn’t want to risk negative publicity in the light of this crash.”

Allianz, Lufthansa’s lead insurer, said that it and Lufthansa’s other insurers may have to pay up to €300 million ($282 million) to cover the costs of the crash.

Germanwings’ parent company, Lufthansa, said it knew that Mr. Lubitz had had an episode of “severe depression” in 2009 and interrupted his flight training, but was fit to finish it after a six-months break.

German prosecutors have said Mr. Lubitz’s medical records stated “suicidal tendencies.”

Investigations so far indicate that Mr. Lubitz intentionally crashed the plane, killing all 150 people on board.

Lufthansa had not informed the German aviation authority about the pilot’s depression when submitting his license.

A 2014 report from the European Aviation Safety Agency, EASA, warned the European Commission that the German  aviation office had not met all E.U. safety regulations.

The Commission became wary of the German authority’s control methods after the European Aviation Safety Agency complained about its insufficient number of staff and supervision controls as well as its limited access to medical reports, according to The Wall Street Journal.

The EASA declined to confirm the details of the findings until the European Commission finishes its investigation.

“The European Comission is currently investigating LBA regarding those reports,” said Dominique Fouda, spokesperson for EASA, “and I cannot say how long this will take.”

 

Sarah Mewes and Franziska Scheven are editors at Handelsblatt Global Edition, based in Berlin. To contact the authors: mewes@handelsblatt.com and scheven@handelsblatt.com

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