China's airlines are to raise their maximum compensation for
injury or death of passengers on domestic airlines from 70,000 yuan
(US$8,750) to 400,000 yuan (US$50,000) per individual according to
a newly revised regulation issued by the General Administration of
Civil Aviation of China (CAAC) -- China's top aviation authority --
on February 28.
Approved by the State Council the newly revised regulation on
the liability limit of domestic airlines for air passengers was
announced by the CAAC on Monday. The new regulation will come into
effect on March 28 this year, according to CAAC official, Yuan
Yaohui.
Yuan Yaohui emphasized that the increased compensation limit
only applied to domestic flights.
Previously China's air carriers were required to compensate
passenger's families 70,000 yuan (US$8,750) for aircraft accidents
resulting in injury or death to those on board. A previous
regulation was issued in 1989 and a later amendment was made in
1993.
Insurance compensation for passengers, who purchased personal
travel insurance or other types of cover, would be independent of
the liability the carriers were responsible for, the new rule
reads.
The newly revised regulation also raises the compensation sum on
each passenger's "carry-on baggage" to 3,000 yuan (US$375) and 100
yuan (US$12.5) per kilogram of checked luggage.?
When asked why the new limit was still considerably lower than
international standards, Yuan Yaohui said that the increased
compensation limit took into account rises in the income of Chinese
citizens and financial resources of airlines.
The per capita disposable income of urban residents reached
10,450 yuan (US$1,300) in 2005, he said. The compensation limit of
400,000 yuan (US$50,000) was set to take into account a victim's
accumulated income over 30 years, funeral costs and travel expenses
of relatives, he added.
Yuan Yaohui said a balance had to be struck when making the
rules. If the compensation limit was too low the interests of
passengers would be violated. If limits were too high then airlines
could find them an excessive burden.
Yuan also said the new liability limit might require adjustments
in future as economic development continued and the CAAC would make
further amendments taking this into account.
Market analysts say the raised levels of compensation could
increase the insurance costs of domestic airlines.
(China.org.cn by Wang Zhiyong, March 1, 2006)