Turkish Airlines Pioneers Use of SAAFI Aviation Insurance for New Aircraft Financing

Business

Turkish Airlines Pioneers Use of SAAFI Aviation Insurance for New Aircraft Financing

Turkish Airlines has become the first airline globally to adopt the newly launched Sompo AXIS Aviation Finance Insurance (SAAFI) product for financing new aircraft deliveries. This milestone transaction was finalized at a signing ceremony held in Tokyo, Japan, marking a significant advancement in aviation finance insurance.

The landmark deal involves the financing of two aircraft — one Airbus A350-900 and one Airbus A321-271NX, both scheduled for delivery in 2026. Under the agreement, JP Lease will arrange equity, while Sumitomo Mitsui Banking Corporation (SMBC) will provide the debt financing. SMBC’s loan is fully supported by an Aviation Non-Payment Insurance (ANPI) policy issued by the SAAFI insurers, Sompo and AXIS, enabling Turkish Airlines to lower its overall financing costs.

The ANPI policy, brokered by Willis, a WTW business (NASDAQ: WTW), supports the financing structure based on the Japanese Operating Lease with Call Option (JOLCO) model — a popular framework in aircraft financing.

“We are pleased to be the launching customer of SAAFI with the support of our valued insurers Sompo and AXIS, insurance broker Willis, and our long-term business partners SMBC and JP Lease,” said Assoc. Prof. Murat Şeker, Chief Financial Officer and Member of the Board and Executive Committee at Turkish Airlines. “With financing models like SAAFI, we enhance our financial flexibility and resilience, further reinforcing our leadership in the aviation industry.”

Tim Gaul, Financial and Political Risks Underwriter at Sompo, noted the insurer’s extensive experience in Aviation Non-Payment Insurance, having supported financing for more than 120 aircraft globally over the past eight years. “We believe our partnership with AXIS through SAAFI will be a welcome addition to our aviation financing solutions, with Turkish Airlines as the first of many to benefit from our expanded capacity,” he said.

Richard Jelf, Senior Underwriter at AXIS, emphasized the significance of this inaugural use of SAAFI: “AXIS is proud to introduce the SAAFI product to the aircraft finance market and thrilled to welcome Turkish Airlines as our first customer. This initiative allows us to expand our role in supporting airline industry growth.”

Stuart Ashworth, Managing Director of Financial Solutions at Willis, a WTW business, added: “We are delighted to assist Turkish Airlines and SMBC with this financing. This marks our first SAAFI mandate with Turkish Airlines and highlights our commitment to supporting innovative and forward-thinking aviation financing strategies.”

The introduction and successful implementation of SAAFI signals a new chapter in aircraft finance insurance, offering innovative, lower-risk financing options to airlines worldwide.