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28 June 2019Insurance

FAA identifies further Boeing 737 Max software issues; delays return to service

The short-term future of the Boeing 737 Max is in limbo after the US regulator found an additional issue with flight software that it has asked the manufacturer to address.

The Federal Aviation Authority (FAA) began investigating the 737 Max and its Mcas flight control system in particular, following two fatal crashes.

In a statement, the FAA said: “On the most recent issue, the FAA’s process is designed to discover and highlight potential risks. The FAA recently found a potential risk that Boeing must mitigate.”

The regulator was clear that it was “following a thorough process, not a prescribed timeline, for returning the Boeing 737 Max to passenger service” and “will lift the aircraft’s prohibition order when we deem it is safe to do so”.

Boeing said the FAA’s review of the 737 MAX software update and recent simulator sessions, ”identified an additional requirement that it has asked the company to address through the software changes that the company has been developing for the past eight months”.

For insurers and reinsurers, this will mean the cost of claims will continue to increase as carriers ground aircraft.

Boeing added that it agreed with the FAA's decision and request, and is working on the required software. It said: “Addressing this condition will reduce pilot workload by accounting for a potential source of uncommanded stabilizer motion.

Boeing will not offer the 737 Max for certification by the FAA until we have satisfied all requirements for certification of the Max and its safe return to service.”

The FAA said it would continue to evaluate Boeing’s software modification to the MCAS and was still developing necessary training requirements.

“We are also responding to recommendations received from the Technical Advisory Board (TAB). The TAB is an independent review panel we have asked to review our work regarding 737 Max return to service,” added the regulator.

More than 340 people were killed in two separate crashes, 157 people were killed when an Ethiopian Airlines plane crashed on the 10 March 2019 and 189 people died in the Lion Air crash in Indonesia in October 2018.

The lead insurer for Boeing is Global Aerospace, which is majority owned by Munich Re, with Berkshire Hathaway owning a substantial share. Chubb and Willis Towers Watson have been identified as lead insurer and broker for Ethiopian Airlines.

Global Aerospace was contacted for comment but had not responded at the time of publication.

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