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In the aftermath of the recent Air India plane crash, a claim on Facebook began circulating online suggesting that Air India would provide $116,000 to the family of each deceased passenger. The report quickly gained traction, widely repeated across many platforms, as can be seen here and here. However, beneath the surface, the reality of the compensation structure is more complex than the claim suggests.
This explainer breaks down the compensation structure, clarifying who is responsible for paying what and how much families can expect to receive, based on official documents and international aviation law.
Where did the $116,000 figure come from?
The figure originates from a combination of payouts, but it was inaccurately attributed.
According to a statement made by the Tata Group, the parent company of Air India, ₹1 crore (approximately $118,000) is being provided to the victims of the crash. This is a voluntary ex gratia payment, not legally required under Indian or international law. This was further reported by The Times of India, which stated:
“The Tata Group has decided to provide an ex gratia amount of ₹1 crore to the next of kin of each deceased passenger… as a humanitarian gesture.”
In addition to this, Air India itself offered an interim relief payment of ₹25 lakh (approx. $29,000) to each bereaved family, as further reported in The Economic Times.
Together, these add up to ₹1.25 crore (roughly $147,000 USD). So, while the viral post cited $116,000, the actual figure is higher; however, it’s not Air India alone that’s providing the full amount.
What is Tata Sons’ role, and why does it matter?
Tata Sons is the parent company of Air India, which operates as a separate legal entity. This distinction is critical. While Tata has committed to making a ₹1 crore payment per family, it is doing so voluntarily, not due to any legal obligations. In legal terms, this is an ex gratia payment, a gesture of goodwill, not a required compensation.
Meanwhile, Air India, the carrier involved in the crash, handles direct operational relief and is subject to the Montreal Convention.
What is the Montreal Convention, and how does it apply?
The Montreal Convention of 1999 (MC99) is an international treaty that governs airline liability in case of death or injury during international travel. India is a signatory.
Under Article 21 of the convention, airlines are strictly liable for up to 171,000 Special Drawing Rights (SDRs) per passenger, regardless of fault. At current IMF conversion rates, this is equivalent to over $227,000 USD.
If the airline is proven negligent, compensation could exceed this cap. Victims’ families also retain the right to pursue legal action to claim the full amount allowable under the convention.
This confirms that through legal channels and international regulations, families may have access to additional compensation beyond what Tata and Air India have offered.
How much are families receiving?
Rather than a single lump-sum payout from Air India, the compensation is derived from multiple sources, each with a distinct legal basis. Here’s the breakdown:
Tata Sons is paying ₹1 crore (about $118,000 USD) as an ex gratia payment, a voluntary, non-binding humanitarian gesture. Air India is providing ₹25 lakh (about $29,000) as interim relief and immediate funeral, legal, and family support.
Combined, these two sources guarantee ₹1.25 crore, equivalent to approximately $147,000. Additionally, families may be eligible for further compensation under the Montreal Convention, which caps liability at 171,000 SDRs. Depending on IMF currency adjustments, this could translate to over $227,000.
Legal proceedings may increase payouts even further if negligence is established.
While the viral figure quoted $116,000 from Air India, the actual compensation structure is more generous and complex, and the source is not limited to Air India alone.
