Hull and liability premiums for airlines were flat in July asinsurers took strong negotiating positions and reductions appearedto be the exception rather than the norm, according to a marketreport from the insurance broker Aon Aviation.

Of the month's renewals, 11 received a reduction in coverage,three received increases of 5-10 percent, and the remaining 14 sawincreases of more than 10 percent.

July has been the most active month, with 46 percent of hull andliability premium renewed this year. With four more renewalsexpected, Aon said it is possible August could close representinghalf of the total premium collected in seven months.

Despite the hard times the industry is currently going through,airlines appear to be anxious to deal with rising fuel costs bypurchasing new planes to improve fuel economy from both anenvironmental and financial perspective.

Aon Aviation, a unit of Chicago-based insurance broker AonCorp., forecasts that the flat market conditions “will continueuntil year end, unless a major incident changes market sentimentsignificantly.”

Loss figures so far this year stand at $496 million compared to$916 million at the same point last year.

An ABX Air Boeing 767-200 was damaged by fire on June 28 whileon the ground at San Francisco International Airport. The22-year-old craft was declared a partial loss resulting in $10million claim. The two-person crew escaped without injury.