/Vol. 62, No. 74/Thursday, April 17, 1997/Proposed Rules
DEPARTMENT OF TRANSPORTATIONFederal Aviation Administration14 CFR Part 198
[Docket No. 28893; Notice No. 97–5]RIN 2120–AF23
Federal AviationAdministration (FAA), DOT.
Notice of proposed rulemaking(NPRM).
The FAA is proposing torevise Title 14 Code of FederalRegulations (CFR) part 198 to providefor the issuance of insurance for certaintypes of flight operations and for theissuance of insurance for certain groundsupport activities essential to flightsinsured under the Aviation InsuranceProgram. Also, the amendments wouldredefine the activation of insurancecoverage, revise the process foramending insurance policies, increasethe binders for non-premium insurancecoverage, and reflect new statutoryauthority. the proposed amendmentswould allow the FAA to be moreresponsive to the aviation industrywhen commercial insurance coveragecannot be obtained on reasonable terms,and the insurance coverage can beprovided by the Aviation InsuranceProgram.
Comments must be received onor before June 2, 1997.
Comments on the proposedrule should be mailed or delivered intriplicate to: Federal AviationAdministration, Office of the Chief Counsel, Attn: Rules Docket (AGC–200),Docket No. 28893, 800 IndependenceAvenue, SW., Washington, DC 20591.Comments may also be sentelectronically to the following Internetaddress: email@example.com.Comments may be examined in theRules Docket, Room 915G, weekdaysbetween 8:30 a.m. and 5:00 p.m., excepton Federal holidays.
FOR FURTHER INFORMATION CONTACT
Eleanor Eilenberg, Office of AviationPolicy and Plans, APO–330, FederalAviation Administration, 800Independence Avenue, SW.,Washington, DC 20591, telephone (202)267–3090.
Interested persons are invited toparticipate in the making of theproposed rule by submitting suchwritten data, views, or arguments asthey may desire. Comments relating tothe environmental, energy, federalism,or economic impact that might resultfrom adopting the proposals in thisnotice are also invited. Substantivecomments should be accompanied bycost estimates. Comments shouldidentify the regulatory docket or noticenumber and should be submitted intriplicate to the Rules Docket addressspecified above.All comments received on or beforethe closing date for comments specifiedwill be considered by the Administratorbefore taking action on this proposedrulemaking. The proposals contained inthis notice may be changed in light of comments received.All comments received will beavailable, both before and after theclosing date for comments, in the RulesDocket for examination by interestedpersons. A report summarizing eachFAA-public contact, concerned with thesubstance of this rulemaking, will befiled in the docket. Commenters wishingthe FAA to acknowledge receipt of theircomments submitted in response to thisnotice must include a preaddressed,stamped postcard on which thefollowing statement is made:‘‘Comments to Docket No. 28893.’’ Thepostcard will be date and time stampedand mailed to the commenter.
Availability of NPRM
An electronic copy of this documentmay be downloaded using a modem andsuitable communications software fromthe FAA regulations section (telephone:703–321–3339), the
electronic bulletin board service(telephone: 202–512–1661), or theFAA’s Aviation Rulemaking AdvisoryCommittee Bulletin board service(telephone: 202–267–5948).Internet users may reach the FAA’sweb page at
http://www.faa.gov or the
’s webpage at http://www.access.gpo.gov/su
docs foraccess to recently published rulemakingdocuments.Any person may obtain a copy of thisNPRM by submitting a request to theFederal Aviation Administration, Officeof Rulemaking, ARM–1, 800Independence Avenue, SW.,Washington, DC 20591, or by calling(202) 267–9680. Communications mustidentify the notice number of thisNPRM.Person interested in being placed onthe mailing list for future NPRM’sshould request, from the above office, acopy of Advisory Circular No. 11–2A,Notice of Proposed RulemakingDistribution System, which describesthe application procedures.
In 1951, the Congress amended theCivil Aeronautics Act of 1938 by addinga new Title XIII which authorized theSecretary of Commerce, with theapproval of the President, to provideaviation war risk insurance adequate tomeet the needs of U.S. air commerceand the Federal Government. Thisinsurance could only be issued whenthe Secretary of Commerce found thatwar risk insurance was commerciallyunavailable on reasonable terms andconditions. The war risk insurance program wasestablished to provide the insurancenecessary to enable air commerce tocontinue to the event of war. This wasneeded because of several factors:commercial war risk insurance policiescontained automatic cancellationclauses in the event of major war; thegeographical coverage of commercialwar risk insurance could be restrictedupon reasonable notice to air carriers;and rates for commercial war riskinsurance could be raised without limitupon reasonable notice to air carriers. The Aviation Insurance Program wasincorporated in Title XIII of the FederalAviation Act of 1958. Statutoryresponsibility for the program wassubsequently transferred to theDepartment of Transportation at thetime of its creation in 1967. TheSecretary of Transportation laterdelegated this authority to the FederalAviation Administrator (39 CFR1.47(b)). The definition of war risk in Title XIIIwas that traditionally employed bycommercial underwriters and, as amatter of policy, the FAA had alwaysconservatively interpreted thedefinition. In the early 1970’s, thisdefinition led to uncertainty about theextent of the Administrator’s statutoryauthority to provide insurance againstloss or damage arising from, forexample, undeclared wars, hijackings,and terrorist acts. Because of acombination of the progressiveexclusion of these new risk fromcommercial all risk policies, and thefailure of the traditional definition of war risk to cover these risks, a potentialgap in insurance coverage occurred withthe possibility of abrupt termination of important air services in emergencysituations.In recognition of the fact that theAdministrator needed broad insuranceauthority in extraordinarycircumstances to insure air servicesdetermined to be in the nationalinterest, Congress amended Title XIII onNovember 9, 1977. These amendments,included in Public Law (Pub. L.) 95–