§ 44302. General authority

3,558 words·~16 min read·/usc/title-49/section-44302

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(a)Insurance and Reinsurance.—

(1)Subject to subsection

(c)of this section and section 44305(a) of this title, the Secretary of Transportation may provide insurance and reinsurance against loss or damage arising out of any risk from the operation of an American aircraft or foreign-flag aircraft.

(2)An aircraft may be insured or reinsured for not more than its reasonable value as determined by the Secretary in accordance with reasonable business practices in the commercial aviation insurance industry. Insurance or reinsurance may be provided only when the Secretary decides that the insurance cannot be obtained on reasonable terms from an insurance carrier.

(b)Reimbursement of Insurance Cost Increases.—

(1)In general.— The Secretary may reimburse an air carrier for the increase in the cost of insurance, with respect to a premium for coverage ending before October 1, 2002, against loss or damage arising out of any risk from the operation of an American aircraft over the insurance premium that was in effect for a comparable operation during the period beginning September 4, 2001, and ending September 10, 2001, as the Secretary may determine. Such reimbursement is subject to subsections (a)(2), (c), and

(d)of this section and to section 44303.

(2)Payment from revolving fund.— A reimbursement under this subsection shall be paid from the revolving fund established by section 44307.

(3)Further conditions.— The Secretary may impose such further conditions on insurance for which the increase in premium is subject to reimbursement under this subsection as the Secretary may deem appropriate in the interest of air commerce.

(4)Termination of authority.— The authority to reimburse air carriers under this subsection shall expire 180 days after the date of enactment of this paragraph.

(c)Presidential Approval.— The Secretary may provide insurance or reinsurance under subsection

(a)of this section, or reimburse an air carrier under subsection

(b)of this section, only with the approval of the President. The President may approve the insurance or reinsurance or the reimbursement only after deciding that the continued operation of the American aircraft or foreign-flag aircraft to be insured or reinsured is necessary in the interest of air commerce or national security or to carry out the foreign policy of the United States Government.

(d)Consultation.— The President may require the Secretary to consult with interested departments, agencies, and instrumentalities of the Government before providing insurance or reinsurance or reimbursing an air carrier under this chapter.

(e)Additional Insurance.— With the approval of the Secretary, a person having an insurable interest in an aircraft may insure with other underwriters in an amount that is more than the amount insured with the Secretary. However, the Secretary may not benefit from the additional insurance. This subsection does not prevent the Secretary from making contracts of coinsurance.

(f)Extension of Policies.—

(1)In general.— The Secretary shall extend through December 11, 2014, the termination date of any insurance policy that the Department of Transportation issued to an air carrier under subsection

(a)and that is in effect on the date of enactment of this subsection on no less favorable terms to the air carrier than existed on June 19, 2002; except that the Secretary shall amend the insurance policy, subject to such terms and conditions as the Secretary may prescribe, to add coverage for losses or injuries to aircraft hulls, passengers, and crew at the limits carried by air carriers for such losses and injuries as of such date of enactment and at an additional premium comparable to the premium charged for third-party casualty coverage under such policy.

(2)Special rules.— Notwithstanding paragraph (1)—

(A)in no event shall the total premium paid by the air carrier for the policy, as amended, be more than twice the premium that the air carrier was paying to the Department of Transportation for its third party policy as of June 19, 2002; and

(B)the coverage in such policy shall begin with the first dollar of any covered loss that is incurred.

(g)Aircraft Manufacturers.—

(1)In general.— The Secretary may provide to an aircraft manufacturer insurance for loss or damage resulting from operation of an aircraft by an air carrier and involving war or terrorism.

(2)Amount.— Insurance provided by the Secretary under this subsection shall be for loss or damage in excess of the greater of the amount of available primary insurance or $50,000,000.

(3)Terms and conditions.— Insurance provided by the Secretary under this subsection shall be subject to the terms and conditions set forth in this chapter and such other terms and conditions as the Secretary may prescribe.

(Pub. L. 103–272, § 1(e), July 5, 1994, 108 Stat. 1168; Pub. L. 105–137, § 2(a), Dec. 2, 1997, 111 Stat. 2640; Pub. L. 107–42, title II, § 201(a), Sept. 22, 2001, 115 Stat. 234; Pub. L. 107–296, title XII, § 1202, Nov. 25, 2002, 116 Stat. 2286; Pub. L. 108–11, title IV, § 4001(a), Apr. 16, 2003, 117 Stat. 606; Pub. L. 108–176, title I, § 106(a)(1), Dec. 12, 2003, 117 Stat. 2498; Pub. L. 108–447, div. H, title I, § 106(a), Dec. 8, 2004, 118 Stat. 3204; Pub. L. 109–115, div. A, title I, § 108(a), Nov. 30, 2005, 119 Stat. 2402;

Pub. L. 110–161, div. K, title I, § 114(a), Dec. 26, 2007, 121 Stat. 2381; Pub. L. 110–253, § 3(c)(6), June 30, 2008, 122 Stat. 2418; Pub. L. 110–330, § 5(c), Sept. 30, 2008, 122 Stat. 3718; Pub. L. 111–12, § 5(b), Mar. 30, 2009, 123 Stat. 1458; Pub. L. 111–69, § 5(c), Oct. 1, 2009, 123 Stat. 2055; Pub. L. 111–116, § 5(b), Dec. 16, 2009, 123 Stat. 3032; Pub. L. 111–117, div. A, title I, § 114(a), Dec. 16, 2009, 123 Stat. 3042; Pub. L. 111–153, § 5(b), Mar. 31, 2010, 124 Stat. 1085;

Pub. L. 111–161, § 5(b), Apr. 30, 2010, 124 Stat. 1127; Pub. L. 111–197, § 5(b), July 2, 2010, 124 Stat. 1354; Pub. L. 111–216, title I, § 104(b), Aug. 1, 2010, 124 Stat. 2349; Pub. L. 111–249, § 5(c), Sept. 30, 2010, 124 Stat. 2628; Pub. L. 111–329, § 5(b), Dec. 22, 2010, 124 Stat. 3567; Pub. L. 112–7, § 5(b), Mar. 31, 2011, 125 Stat. 32; Pub. L. 112–16, § 5(b), May 31, 2011, 125 Stat. 219; Pub. L. 112–21, § 5(b), June 29, 2011, 125 Stat. 234; Pub. L. 112–27, § 5(b), Aug. 5, 2011, 125 Stat. 271;

Pub. L. 112–30, title II, § 205(c), Sept. 16, 2011, 125 Stat. 358; Pub. L. 112–91, § 5(c), Jan. 31, 2012, 126 Stat. 4; Pub. L. 112–95, title VII, § 701, Feb. 14, 2012, 126 Stat. 118; Pub. L. 113–46, div. A, § 152, Oct. 17, 2013, 127 Stat. 565; Pub. L. 113–76, div. L, title I, § 119E(a), Jan. 17, 2014, 128 Stat. 582; Pub. L. 113–164, § 148(a), Sept. 19, 2014, 128 Stat. 1874; Pub. L. 113–235, div. L, § 102(a), Dec. 16, 2014, 128 Stat. 2767.)

In subsection (a)(1), before clause (A), the words “Subject to subsection

(b)of this section” are added, and the words “American aircraft or foreign-flag aircraft” are substituted for “aircraft” in 49 App.:1532(a), for clarity. The words “in the manner and to the extent provided by this subchapter” are omitted as unnecessary. The words “Insurance shall be issued under this subchapter only to cover any risk from the operation of an aircraft . . . such aircraft is” are omitted because of the restatement. In clause (B), the word “places” is substituted for “points” for consistency in the revised title.

In subsection (a)(2), the words “An aircraft may be insured or reinsured for not more than” are substituted for “and such stated amount shall not exceed” in 49 App.:1537(a) for clarity and because of the restatement. The words “its reasonable value” are substituted for “an amount . . . to represent the fair and reasonable value of the aircraft” to eliminate unnecessary words. The words “Insurance or reinsurance may be provided only” are added because of the restatement. The word “conditions” is omitted as being included in “terms”.

In subsection (b), the words “The Secretary may provide insurance or reinsurance under subsection

(a)of this section only with the approval of the President” are substituted for “with the approval of the President” for clarity and because of the restatement. The words “The President may” are substituted for “The President shall” because the authority of the President is discretionary.

In subsection (c), the words “the Secretary to consult . . . before providing insurance or reinsurance under this chapter” are substituted for “and after such consultation . . . as” because of the restatement. The words “departments, agencies, and instrumentalities” are substituted for “agencies” for consistency in the revised title and with other titles of the United States Code.

In subsection (d), the words “However, the Secretary may not benefit from the additional insurance” are substituted for “in that event, the Secretary shall not be entitled to the benefit of such insurance” for clarity.