As with any significant investment, protecting an aircraft with insurance is of utmost importance – but how much will it cost?
An aviation insurance provider that understands your specific needs is your ideal solution. Look for companies with extensive experience and strong broker relations; those that provide optimal liability and airplane hull coverage could provide optimal solutions tailored specifically to you and your situation.
Coverage
Aircraft insurance protects plane owners and pilots against financial loss in the event of an aircraft accident, covering legal fees and settlements as well as repairs or replacement costs for damaged or destroyed planes. Insurance policies vary in terms of coverage, deductibles, limits and policies available – therefore it’s wise to review each option thoroughly prior to purchasing an aircraft policy. There are various types of aircraft policies available ranging from hull/liability coverage (some insurers provide combined public/passenger liability policies) through non-owned aircraft liability coverage or war risk coverage to personal accident coverages policies which cover various risks.
An aviation insurance policy’s first page, known as a Declaration Page, details information about both the plane and its owner. This may include aircraft type and model specifications; named insured; policy duration date and insurance limits (hull & liability); as well as any deductible amounts due from insureds prior to coverage commencing; for example if an aircraft is damaged in an accident and has an insured deductible amount of $10,000 then payment up to that threshold will need to be made before coverage commences;
Liability coverage is the foundation of any aircraft insurance policy, protecting third-party property and passengers should they become injured during an accident. Some policies also cover medical expenses or funeral costs in case an aircraft crash is fatal.
Hull coverage (also referred to as physical damage coverage) protects an aircraft against financial loss caused by perils such as fire, theft or collision, while offering replacement costs should it become stolen or destroyed. Flight schools typically require at least $30,000 worth of aircraft damage liability before renting training aircrafts for training courses.
Aircraft insurance is required by some states and can be obtained from numerous companies. While aircraft policies tend to be more costly than other forms of coverage, they can help save their owners significant financial losses in case of an accident. Private pilots and regular flyers should take special note in procuring this form of protection.
Deductibles
As with other forms of insurance, aircraft coverage includes a deductible – this amount must be paid out-of-pocket before an insurer begins paying on claims. Most policies have both a hull damage deductible and liability deductible – usually calculated as a percentage of insured value such as 10% for an aircraft valued at $10,000 with 10% deductible = an owner must cover up to the first $3,000 when suffering an incident or loss.
Aircraft hull insurance provides coverage against damages caused by collision with another aircraft or object, vandalism or weather incidents on the ground, legal disputes and costs related to legal disputes. Furthermore, liability coverage protects insureds against lawsuits brought forth against them from third parties for personal or property damages caused by other people.
Though most states do not require aircraft insurance, it is wise to purchase it as it will protect you financially and make your aircraft more desirable to potential buyers. When setting deductible and coverage amounts for an insured value policy it is crucial that they are in balance; under- or over-insuring can result in higher premiums so it is also wise to factor this information when setting policy parameters.
Typically speaking, the higher your pilot rating and flying experience is, the lower your aircraft insurance rates will be as insurers view you as being lower risk and are willing to offer better rates. Furthermore, having less accidents or incidents on your record also leads to cheaper aircraft insurance premiums.
SkyWatch offers an all-encompassing policy tailored to non-owned pilots that makes getting a quote and flying with peace of mind effortless. As an AOPA member you’re entitled to a 5% discount; plus there’s also an annual renewal discount of 10% after five consecutive years with a clean record! Additionally they have short term policies specifically targeted towards drone owners and remote operators of small UAS.
Policy limits
Your liability coverage requirements depend on the type and use of aircraft that you own or operate, so it is wise to discuss your specific use with a broker in order to assess what limits and coverages might be appropriate for you.
Liability coverage typically comprises the majority of a private aircraft insurance premium. Your insurer will base its rates on both your aircraft’s hull value and standard liability limits; additional factors, including claims history, pilot training, utilization, mission profile and storage location can influence its rates as well.
As an example, if you own a jet with limited seating capacity, your passenger liability limits may differ than if you owned a four-seat airplane. Furthermore, different carriers provide different liability limit options; some provide “smooth” liability policies while others require per passenger sublimits.
Smooth limit liability policies allow for a single combined limit for bodily injury and property damage without any sub-limits for passengers on your personal aircraft, making this an attractive option for frequent flyers who regularly bring friends or business associates along for their journeys.
Smooth limit policies often cost several hundred more than sublimit policies; however, their additional premium may be worthwhile if your aircraft carries passengers.
An additional limitation to consider is non-owned physical damage liability, which protects aircraft owners when their aircraft is damaged by an incident that wasn’t caused by them or their crew members. It’s usually available as an add-on policy with a deductible starting around $10,000; for more information, contact your broker.
Age of the aircraft
Age can play an integral part in calculating an aircraft’s insurance premiums. Aviation experts use various metrics such as its year of manufacture, flight cycles and flight hours as measures of ageing aircraft, such as metal fatigue issues. To establish its age accurately.
Accidents on board an aircraft can also have a direct bearing on its insurance rates, with incidents often measured through various metrics including hull coverage, public liability and passenger/crew liability. Furthermore, insurance companies will take into account both pilot experience and training history when setting premiums.
Expert pilots with advanced certifications and licenses tend to be perceived as safer pilots, leading to lower insurance costs. On the other hand, younger pilots tend to be seen as riskier and therefore more likely to cause an accident; furthermore, more experienced pilots tend to face higher premiums as a result of their experience level.
Aviation damage repairs can be costly, which is why many aircraft owners opt to have their airplanes “totaled” – in other words, have their insurance company pay out on its full insured value – instead. Unfortunately this trend has become more frequent as parts that were once readily available now cost significantly more to replace; to prevent costly repairs it is crucial that aircraft are regularly maintained and inspected to avoid this fateful decision.
Other factors that can have an effect on an airplane’s insurance rates are its age and type. A Cessna 172 costs significantly less to insure than Gulfstream jet, for instance; also, helicopters cost more to cover than single-engine aircraft such as Piper Cherokees or Cessna 150s.
Private aircraft owners typically spend several hundreds to several thousands per year for liability and hull coverage. While it’s hard to generalize about airplane insurance costs, each individual’s premium rate depends on numerous variables; to get the best rate possible it’s wise to consult an aviation specialist about your aircraft and pilot history in order to assess them accurately.