We were instructed by Insurers to assess the loss of profit and additional costs sustained by an airline carrier resulting from an airport terrorist attack.
The airlines and many other service providers at the airport suffered long tail losses for up to 12 months after the attack, despite the airport having been closed only for a matter of days, with repairs ongoing for a few weeks thereafter. During the repair period the airport operated a slightly altered flight plan. During the closure of the airport a significant amount of passengers cancelled future flights and new bookings were significantly down for many weeks. Even after the airport was fully repaired, passenger numbers and new flight bookings did not return to the expected level and showed a shortfall against other market data and historically trended figures.
We were asked to determine the actual loss over the time period and determine the loss that resulted from a reduced flight plan, the loss that resulted from lesser passenger bookings and to what extent the losses resulted directly from the incident and resulting airport close and repair.