NEW YORK (Bloomberg) — Airline insurers, a group led by Warren Buffett's Berkshire Hathaway Inc. and Allianz SE, may lose money this year on costs from the Air France crash, forcing the industry to raise prices, broker Aon Corp. said.

"The airline insurance market is set to endure a third year without profit," the Chicago-based insurance broker said in a report this week. "As a result, it seems likely that the airline insurance market will continue to harden until well into 2010," meaning airlines will pay higher rates.

Several Bermuda companies took a hit as a result of the crash of the Air France jet, which plunged into the sea en route from Rio de Janeiro to Paris leaving 228 people dead. Among those to have revealed their share of claims, plus expenses, from the crash were Aspen, who paid out $12.5 million, Validus ($11 million), IPC ($9 million), which has since merged with Validus, and XL Capital ($4.6 million).

Insurers will collect about $1.9 billion in premiums for hull and liability coverage this year, and have incurred $2.26 billion in claims so far, Aon said. Claim costs increased 70 percent from 2008 on the Air France-KLM crash off the coast of Brazil in June and the Colgan Air accident near Buffalo, New York, in February.

"If there had not been the Air France and Colgan Air losses, 2009 would potentially have been a fairly average or even good year for claims," Aon said.

The cost to Air France-KLM's pool of insurers, including Allianz and American International Group Inc., depends on estimates of the travellers' nullified lifetime earnings and any negligence demonstrated by the airline.

In addition, a plane operated by Colgan Air, a unit of Pinnacle Airlines Corp., crashed on February 12 as it approached Buffalo's airport from Newark, New Jersey, killing 50. Prices for hull and liability protection have increased for about 80 percent of coverage placed so far in 2009, Aon said. Rates rose 24 percent during the December renewals from a year earlier.

The increase in aviation insurance rates compares with price declines for other types of coverage. Overall US commercial insurance rates have dropped every quarter since 2004, according to the Council of Insurance Agents and Brokers.

"Unless there is a significant event in the industry, prices are likely to continue to rise at their current rate until well into 2010," Aon said. "Underwriters are desperate" for a profitable year, the report said.

Rising insurance rates add to the airline industry's costs as consumers and corporations cut travel expenses amid the recession. Corporate travel revenue fell as much as 35 percent in early 2009, US Airways Group Inc.'s President Scott Kirby said at a conference last week. Revenue began to increase last month, he said.

UAL Corp.'s United Airlines said at the same conference that revenue from corporate customers declined 25 percent in September, compared with May, when its business travel revenue plunged 43 percent. Delta Air Lines Inc. and AMR Corp.'s American Airlines Inc. have posted losses for the last eight quarters. UAL has lost money in seven of the last eight quarters.

Berkshire, based in Omaha, Nebraska, sells the most US aircraft insurance, with 14 percent of the market, according to 2008 data compiled by the National Association of Insurance Commissioners. Allianz ranks second and AIG is third.