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First Payments from Malaysian Plane Crash: Only $5,000?

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So as I predicted in my previous article, issues of liability were around the corner. It looks like they came sooner than expected and from an unexpected volunteer. On Tuesday, Malaysia Airlines announced the first batch of payments it would make to families of passengers on Flight 370. The amount? $5,000 per passenger. This pre-emptive payment is not by any means the final payment by Malaysia Airlines, as the Montreal Convention set the $150,000 threshold, and experts expect next of kin compensation could eventually exceed millions of dollars per passenger.

So far, Malaysia Airlines has also provided money for food, lodging, and any travel expense the families may have since the incident unfolded on March 8. The airline has pledged to continue this aid for as long as possible. But with more and more people assuming all lives have been lost, people are turning their eyes toward compensation for the families of passengers.

One attorney, Monica Kelly, spoke to CNN and said that within her experience, Malaysia airlines may be forced to pay between $400,000 and $3 million per family.

Another attorney, Mike Danko, said the amount of money families are awarded has a lot of to do with where they filed a lawsuit. For instance, U.S. courts will probably give families more money than those in China. Passengers on Flight 370 came from 14 different countries, so lawsuits could be filed in any of those.

At least in the US, one of the more difficult (and arbitrary) set of decisions will come when the courts decide how much each family gets… by figuring out how much each person’s life was worth in the first place. Each passenger will be assessed separately, and the amount of money awarded to each family is decided on a number of factors. For instance, someone with 3 small children may receive more money than a single person in his 40s.

But Malaysia Airlines may have some help, as well. Airlines tend to be covered by insurance policies ranging between $2 to $2.5 billion, with as much as $10 million set aside by each passenger, according to Brian Havel, director of the International Aviation Law Institute at DePaul University.

And as previously discussed, the logistics surrounding this still-missing aircraft could slow the process down. But assuming a long period of time goes by and no sign of the aircraft is found, courts might go ahead and rule the passengers as deceased, allowing families to sue for damages and collect life insurance.

[CBS] [CNN] [Yahoo]

Molly Hogan (@molly_hogan13)

Featured Image Courtesy of [Allen Watkin via Flickr]

Molly Hogan
Molly Hogan is a student at The George Washington University and formerly an intern at Law Street Media. Contact Molly at staff@LawStreetMedia.com.

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