Following the devastating Air India Flight AI-171 crash in Ahmedabad on June 12, 2025, Air India has announced that it will provide an interim relief of Rs 25 lakh to the families of the crash victims. This is in addition to other compensation packages being offered by the Tata Group, which owns Air India, and insurance providers. The crash, involving a Boeing 787-8 Dreamliner en route to London Gatwick, occurred shortly after takeoff from Sardar Vallabhbhai Patel International Airport and resulted in the loss of 241 lives, including passengers, crew members, and individuals on the ground.
The interim relief of Rs 25 lakh is intended to help families cope with immediate financial needs, such as funeral expenses and other urgent costs. This payment is separate from the larger compensation amounts that families are entitled to under the Montreal Convention, an international treaty that governs airline liability in the event of death or injury to passengers.
Under the Montreal Convention, Air India is liable to pay a compensation of approximately Rs 1.8 crore (151,880 Special Drawing Rights) per deceased passenger. This amount is calculated based on a basket of international currencies, including the US dollar, euro, Chinese renminbi, Japanese yen, and British pound sterling. The convention also mandates that airlines make advance payments to the victims’ families without delay, to meet immediate financial needs. These advance payments must be no less than 16,000 SDRs, or approximately Rs 18 lakh per passenger, and are required to be issued promptly, even before the official investigation concludes.
In addition to the compensation required by the Montreal Convention, the Tata Group has announced a separate compensation package of Rs 1 crore for each deceased individual, including both passengers and those who lost their lives on the ground. The group has also committed to covering the full medical expenses of those injured in the crash. This additional compensation reflects the Tata Group's commitment to supporting all affected individuals, irrespective of their status as passengers or ground residents. Tata group and Air India have also pledged to support the reconstruction of the BJ Medical College hostel, which was severely damaged during the crash.
The Air India AI171 crash has triggered a multi-faceted response, including forensic teams working to identify victims through DNA tests and the filing of petitions in the Supreme Court seeking additional relief and compensation for the victims' families. Two medical professionals have approached the Supreme Court, seeking interim compensation of Rs 50 lakh for each bereaved family, including those of resident doctors who were in the BJ Medical College hostel. The petition also calls for a thorough investigation into the cause of the crash and a long-term rehabilitation plan for the victims' families, including offering government jobs to eligible family members of the deceased.
The insurance claims and compensation payouts related to the crash are estimated to range between US$120 million and US$150 million (Rs 1,000–1,250 crore), including hull insurance, passenger liability claims, and damages to the medical college and other third-party losses. The primary insurers for Air India include Tata AIG General Insurance, ICICI Lombard, New India Assurance, and other public sector insurers, with a consortium of reinsurers led by AIG managing the final compensation liability.
