Allianz Global Corporate & Speciality, the lead insurer for MAS, has placed the payment to MAS in an escrow account, UK daily The Telegraph reported yesterday.
According to the paper, Allianz said it will provide hardship payments for families of the 227 passengers on board MH370 to help them cope with current expenses.
With the search now in its third week, The Telegraph said the payment was made as standard air travel policy states the assumption that a plane is destroyed if it goes missing for over two days.
The paper noted that Allianz was not the only insurer involved, as the insurance policy had been reinsured by other international companies.
While it said millions more could be paid out to the 227 passengers’ families, The Telegraph said insurers are keeping a close eye on the search as terrorism or negligence could change the amount that they would have to pay.
In interviews with The Malay Mail Online, lawyers have urged families to seek legal advice before signing documents for compensation from airlines and their insurers.
Lawyers had also previously told The Malay Mail Online that families of those on Beijing-bound flight MH370 can already start claiming for compensation even before the discovery of the plane and bodies.
At a minimum, an international aviation treaty — the Montreal Convention — allows the next-of-kin of the plane’s 227 passengers to seek up to US$175,000 (RM573,475) each without proving any fault with MAS.
MH370 and the 239 people on board disappeared less than an hour after the Beijing-bound flight left Kuala Lumpur International Airport at 12.41am on March 8.
Search operations involving 26 countries are still being carried out, with sighting of debris possibly linked to the plane in recent days touted as “credible leads” and raising hopes of the plane’s discovery.
