Aviation insurance experts have said that the atrocious missile attack on Malaysia Airlines flight MH17 could cost hundreds of millions of dollars in legal battles and compensation.

Following yesterday's tragic events, insurers and lawyers have begun thinking about the potential costs.

Joseph Wheeler, an aviation lawyer at Shine Lawyers, told the Wall Street Journal: "This is going to be a very long, convoluted and politically charged compensation case for those families."

"In terms of a loss this size, you are looking at hundreds of millions," he continued.

Malaysia Airlines will have to shell out compensation in the first instance thanks to the invocation of the Montreal Convention – an international aviation agreement. The already struggling airline could be forced to pay out up to $170,000 per passenger, whether it's at blame or not.

Malaysia Airlines will likely have to shoulder a proportion of blame because it knew Ukraine was a danger zone.

"The difficulty facing Malaysia Airlines here is that the passengers could argue that most airlines...knew the Ukraine airspace was a war zone and that two other aircraft had been shot down the previous week," said aviation law partner at Cooper Grace Ward Lawyers, Kevin Bartlett.