Delays mount at Brazil airports

More than half of all flights in Brazil were delayed or canceled on Tuesday for the third straight day as the country's air crisis deepened following a deadly crash last week and a major radar outage.
Brazil's airports authority, Infraero, said 590 flights were delayed nationwide and 298 more were canceled by the evening, further angering travelers who have already been subjected to repeated disruptions in the past 10 months.
"I've been trying to get home for a week," Graca Ribeiro, an engineer from the Amazon city of Belem, shouted as she waited at Rio de Janeiro's international airport. "I haven't been able to go to work and have had to pay for a hotel out of my own pocket."
The chaos raised tension at airports around the country. In Rio, passengers protested the delays by donning red clown noses. In the northeastern city of Fortaleza, a group of irate travelers stormed the tarmac and occupied a plane until being removed by police, local radio reported.
Gol Linhas Aereas (GOLL4.SA: Quote, Profile, Research)(GOL.N: Quote, Profile, Research), the country's No. 2 airline, responded to the turmoil on Tuesday by urging passengers to postpone travel plans until next Monday, when it will unveil a revamped route network.
Most of the delays and cancellations happened in the business capital Sao Paulo, where heavy rains on Monday and thick fog on Tuesday forced authorities to close Congonhas airport for hours at a time, setting off a ripple-effect of disruptions at other airports.
The aviation authority ANAC prohibited the sale of tickets for flights leaving from Congonhas, the country's busiest airport, until traffic normalized. It also limited long-distance flights out of Congonhas.
TAM Linhas Aereas (TAMM4.SA: Quote, Profile, Research)(TAM.N: Quote, Profile, Research), the No.1 airline, suspended ticket sales until Thursday for flights to and from Congonhas and Sao Paulo's international airport Guarulhos
The downpours caused a small mudslide on the edge of the airfield at Congonhas that spilled over onto a highway that provides access to the terminal.
The mudslide took place at the same airport where an Airbus A320 (EAD.PA: Quote, Profile, Research) flown by TAM skidded off a rain-slicked runway last Tuesday and crashed into a nearby cargo building and gas station, bursting into flames.
All 187 people on the flight and at least 12 more on the ground were killed in the accident, the deadliest in Brazil's history. Firefighters are still searching for bodies at the site, which the city plans to turn into a memorial.
The TAM accident was the second major air disaster in Brazil since last September, when a Boeing 737 (BA.N: Quote, Profile, Research) operated by Gol clipped wings with a private jet and crashed in the Amazon jungle. All 154 people on board were killed.
The Gol accident exposed serious flaws in Brazil's aviation system, touching off months of delays and cancellations that the government has struggled to remedy.
Air traffic controllers, fearing they were being blamed for the country's aviation woes, have staged periodic work slowdowns for months to protest outdated radar and radio equipment and poor salaries.
The crisis worsened over the weekend when a radar glitch in the Amazon forced more than a dozen international flights to change course, causing delays at several airports in Brazil and the United States.

INSURANCE NEWS

Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. Insurance is defined as the equitable transfer of the risk of a potential loss, from one entity to another, in exchange for a premium. Insurer, in economics, is the company that sells the insurance. Insurance rate is a factor used to determine the amount, called the premium, to be charged for a certain amount of insurance coverage.

Life insurance and saving

Certain life insurance contracts accumulate cash values, which may be taken by the insured if the policy is surrendered or which may be borrowed against. Some policies, such as annuities and endowment policies, are financial instruments to accumulate or liquidate wealth when it is needed. See life insurance. In many countries, such as the U.S. and the UK, the tax law provides that the interest on this cash value is not taxable under certain circumstances. This leads to widespread use of life insurance as a tax-efficient method of saving as well as protection in the event of early death.

Principles of insurance

Commercially insurable risks typically share seven common characteristics. 1. A large number of homogeneous exposure units. The vast majority of insurance policies are provided for individual members of very large classes. Automobile insurance, for example, covered about 175 million automobiles in the United States in 2004. The existence of a large number of homogeneous exposure units allows insurers to benefit from the so-called “law of large numbers,” which in effect states that as the number of exposure units increases, the actual results are increasingly likely to become close to expected results. There are exceptions to this criterion. Lloyds of London is famous for insuring the life or health of actors, actresses and sports figures. Satellite Launch insurance covers events that are infrequent. Large commercial property policies may insure exceptional properties for which there are no ‘homogeneous’ exposure units. Despite failing on this criterion, many exposures like these are generally considered to be insurable. 2. Definite Loss. The event that gives rise to the loss that is subject to insurance should, at least in principle, take place at a known time, in a known place, and from a known cause. The classic example is death of an insured on a life insurance policy. Fire, automobile accidents, and worker injuries may all easily meet this criterion. Other types of losses may only be definite in theory. Occupational disease, for instance, may involve prolonged exposure to injurious conditions where no specific time, place or cause is identifiable. Ideally, the time, place and cause of a loss should be clear enough that a reasonable person, with sufficient information, could objectively verify all three elements. 3. Accidental Loss. The event that constitutes the trigger of a claim should be fortuitous, or at least outside the control of the beneficiary of the insurance. The loss should be ‘pure,’ in the sense that it results from an event for which there is only the opportunity for cost. Events that contain speculative elements, such as ordinary business risks, are generally not considered insurable. 4. Large Loss. The size of the loss must be meaningful from the perspective of the insured. Insurance premiums need to cover both the expected cost of losses, plus the cost of issuing and administering the policy, adjusting losses, and supplying the capital needed to reasonably assure that the insurer will be able to pay claims. For small losses these latter costs may be several times the size of the expected cost of losses. There is little point in paying such costs unless the protection offered has real value to a buyer. 5. Affordable Premium. If the likelihood of an insured event is so high, or the cost of the event so large, that the resulting premium is large relative to the amount of protection offered, it is not likely that anyone will buy insurance, even if on offer. Further, as the accounting profession formally recognizes in financial accounting standards (See FAS 113 for example), the premium cannot be so large that there is not a reasonable chance of a significant loss to the insurer. If there is no such chance of loss, the transaction may have the form of insurance, but not the substance. 6. Calculable Loss. There are two elements that must be at least estimatable, if not formally calculable: the probability of loss, and the attendant cost