ExecutiveOrdersEO
MemoMemorandumObama · D

Presidential Memorandum

Provision of Aviation Insurance Coverage for Commercial Air Carrier Service in Domestic and International Operations

This memorandum extends the federal government's program providing aviation insurance or reinsurance to U.S. air carriers when such coverage cannot be obtained commercially on reasonable terms. The President determines that continuation of U.S. commercial air transportation is necessary for air commerce, national security, and foreign policy, and approves the Secretary of Transportation to provide this coverage through September 30, 2012.

Federal Register Open PDF 76 FR 61247

Impact dates

  1. Insurance/reinsurance authority expires

Key directives

  • Determine that continuation of U.S. commercial air transportation is necessary for air commerce, national security, and foreign policy
  • Approve provision of insurance/reinsurance to U.S. air carriers under 49 U.S.C. 44301-44310
  • Direct Secretary of Transportation to notify all air carriers immediately
  • Direct Secretary of Transportation to arrange for Federal Register publication

Who is ordered

Timeline

Immediate

  • Secretary of Transportation directed to notify all air carriers and arrange Federal Register publication

Near term (90d)

  • Insurance/reinsurance coverage continues under existing framework

Long term

  • Program authorization expires September 30, 2012 unless extended

Risks & tensions

  • Program represents ongoing government backstop for private market failure in aviation insurance
  • Temporary extension suggests recurring congressional/presidential negotiation over permanent solution
  • Conditionality ('when he determines such insurance cannot be obtained on reasonable terms') leaves discretion with Secretary but may create uncertainty for carriers
Presidential Memorandum: Provision of Aviation Insurance Coverage for Commercial Air Carrier Service in Domestic and International Operations · Executive Orders