Airlines to pay out more for flight delay, baggage loss

New Delhi: The Union Cabinet has approved a proposed amendment that will give passengers or their kin higher compensation from airlines for “damage sustained in case of death or bodily injury for each person, flight delays, destruction, loss, damage or delay of flight baggage, and destruction, loss or delay in relation to carriage of air cargo”.

The government is now expected to move the amendment in Parliament soon as it will have to amend the Carriage By Air Act, 1972, in line with the new provisions under the Montreal Convention after the International Civil Aviation Organisation (ICAO) decided on the margin of the compensation hike.

Airlines will need to shell out more for the increased liabilities.

The damage sustained in case of death or bodily injury for each person has been hiked by 1 lakh Special Drawing Rights (SDRs) to about 1.13 lakh SDRs. For delays in carriage (flight delays), the liability has been hiked from 4,150 SDRs to 4,694 SDRs.

For destruction, loss, damage or delay of baggage, the compensation SDRs have been hiked from 1000 SDRs to 1,131 SDRs while for destruction, loss or delay in carriage of air-cargo, the hike in liabilities are from 17 SDRs to 19 SDRs. SDRs have been defined as supplementary foreign exchange reserve assets maintained by the International Monetary Fund (IMF) which can be converted into US dollars or other currencies.