Peter Greenberg writes an excellent article about the complicated world of airline insurance.
Published before the crash of MH17, it crudely shows how some airlines gain financially with the insurance recovery for a plane loss.
It then all boils down to the ability of proving wrongful death: if the passengers' relatives can't, the Montreal Convention kicks in, with its relatively low financial payouts.
The people who own the plane get a whopping check; the people who financially secured the equipment on that plane get a whopping check, but the family members will be stalled by the defendants. … The commodity is more valuable than human life. And the owners of that commodity are somehow entitled to swift justice — and huge payments — as opposed to the victims.
In the case of the MH370,
unless they find the airplane, the cockpit voice recorder, and the flight data recorder — and those devices can categorically prove terrorism or some other form of negligence — there’s a distinct possibility these families will get little or nothing above the standard $175,000. This crash … “might turn out to be very inexpensive.”
It's too early to say what will happen with MH17. The Montreal Convention governs that an airline can avoid liability for sums exceeding the 175k only if it can prove it was totally "free from fault", usually an impossible task, even in cases of terrorism.
From the looks of it though, Malaysia Airlines hasn't done anything wrong here.