A U.K. High Court ruling has dealt a significant setback to aviation insurers seeking to recover losses tied to aircraft stranded in Russia following the 2022 invasion of Ukraine.
The court rejected approximately $340 million in claims brought by Chubb European Group and Fidelis Insurance Ireland against war-risk underwriters after the insurers had compensated aircraft lessors under contingent war-risk policies. The payments primarily related to losses experienced by major lessors, including AerCap and Merx Aviation Finance, whose aircraft became effectively unrecoverable after Russia enacted measures that prevented the return of foreign-owned aircraft.
The dispute stems from a landmark 2025 judgment in which the High Court determined that the losses fell under war-risk coverage, enabling lessors to pursue billions of dollars in insurance claims for aircraft stranded in Russia. That ruling awarded AerCap more than $1 billion under war-risk policies and reinforced insurers' exposure to geopolitical and sovereign-risk events.
In the latest decision, Chubb and Fidelis argued that because they paid claims after war-risk insurers allegedly failed to do so, they should be entitled to reimbursement through indemnity or contribution. The court disagreed, finding their payments did not extinguish the underlying liabilities of the war-risk insurers. Instead, any recovery efforts would need to proceed through subrogation rights exercised on behalf of insured parties rather than direct reimbursement claims.
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