If an aircraft is lost and the insurer pays the claim in full, what happens if the plane is later recovered?

When an insurer pays a claim in full for a lost aircraft, they effectively acquire rights to that asset. If the aircraft is subsequently recovered, the insurer has the option to claim the recovered plane. This principle is rooted in the concept of subrogation, where the insurer takes over the rights of the insured after compensating them for their loss.

Under subrogation, the insurer can pursue any recovery of the asset that may still hold value. Therefore, once the aircraft is recovered, the insurer can assert their right to take possession of it because they have already compensated the owner for the loss. The owner, having received full payment, no longer has a claim to the aircraft.

This mechanism ensures that the insurer is not paying out a loss for an asset that still retains value, thus protecting their financial interests as well as maintaining the integrity of the insurance policy. Other options, such as the insurer keeping the plane without compensation or returning it without any conditions, do not align with established insurance principles regarding ownership and claims.