Which of the following statements about insurance in aviation sector is/are correct?
1. 'Aviation Hull Insurance' covers the physical aircraft, including the body, engine, and on-board equipment.
2. Under the Montreal Convention, adopted in 1999 by over 130 countries, including India, airlines are strictly liable to pay compensation to the family/nominee of every deceased passenger without requiring the family to prove fault.

Select the answer using the code given below :

Correct Option: (c) Both 1 and 2

The correct option is (c). Both statements 1 and 2 are correct. Aviation Hull Insurance covers physical damage or loss to the aircraft itself, including its body (airframe), engines, and integrated on-board equipment (Statement 1). Under the Montreal Convention of 1999, ratified by India and over 130 nations, airlines are subject to a two-tier liability regime where they are strictly liable for proven damages up to a certain threshold without requiring the grieving family to prove negligence or fault on part of the airline (Statement 2). Consequently, options (a), (b), and (d) are incorrect as they fail to recognize the validity of both provisions.