Hull and liability premiums for airlines were flat in July as insurers took strong negotiating positions and reductions appeared to be the exception rather than the norm, according to a market report from the insurance broker Aon Aviation.

Of the month's renewals, 11 received a reduction in coverage, three received increases of 5-10 percent, and the remaining 14 saw increases of more than 10 percent.

July has been the most active month, with 46 percent of hull and liability premium renewed this year. With four more renewals expected, Aon said it is possible August could close representing half of the total premium collected in seven months.

Despite the hard times the industry is currently going through, airlines appear to be anxious to deal with rising fuel costs by purchasing new planes to improve fuel economy from both an environmental and financial perspective.

Aon Aviation, a unit of Chicago-based insurance broker Aon Corp., forecasts that the flat market conditions “will continue until year end, unless a major incident changes market sentiment significantly.”

Loss figures so far this year stand at $496 million compared to $916 million at the same point last year.

An ABX Air Boeing 767-200 was damaged by fire on June 28 while on the ground at San Francisco International Airport. The 22-year-old craft was declared a partial loss resulting in $10 million claim. The two-person crew escaped without injury.

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