Aircraft Owner Insurance

As you might expect, pilots with more experience and few accidents get lower rates simply because, to insurance carriers, they pose less of a risk. Logging more pilot-in-command flight time in your make and model of aircraft, remaining claims-free and earning your instrument rating can all help lower costs as insurers calculate your premium. In sum, the best things you can do are to fly more, fly safely and keep upgrading your ratings and skills.

An open pilot warranty is a clause in many aircraft insurance policies that allows pilots with certain minimum qualifications to fly the aircraft on an occasional basis without being specifically endorsed on the policy as a "named pilot."

Insurance policies vary, but some companies allow for reimbursement of some costs associated with the flight. The broadest form allows for reimbursement as long as no financial profit is made. Give us a call to review your current coverage, and we can discuss the scenario you're considering.

Imagine having to make an emergency landing in your airplane. You spy a golf course below with a long fairway where you're able to land the plane. Unfortunately, during the landing, a wing clips by a golfer, your passenger suffers a neck injury, the fairway is torn to shreds and your aircraft is damaged.

Your liability coverage includes property damage (other than your owned aircraft), bodily injury outside the aircraft and bodily injury inside the aircraft.

With a smooth limit, you have the entire limit amount to address all three liability claims — if you insured at $1 million smooth, you have the full $1 million to cover the claims. Policies with smooth limits are typically more expensive, but as we look at policies with a sublimit, you'll understand why.

With a per-passenger sublimit, coverage for the passenger is limited to the amount listed on the policy. For instance, if you insured at $1 million combined single limit with $100,000 per passenger, the golfer and the course would be covered under the $1 million and coverage for the passenger would be limited to $100,000.

With a per-person sublimit, your coverage amount is limited not only for your passenger, but also for the golfer, since each is a "person." For instance, if you insured at $1 million combined single limit with $100,000 per person, the course would be covered under the $1 million, and the golfer and the passenger would be limited to a maximum of $100,000. Because per-person sublimits are the most restrictive — and because there's almost never a related premium savings — avoid them if possible. At Gallagher, we don't offer a per-person sublimit.

The proper insured value to carry is the amount of money it would take to purchase another aircraft exactly like yours (i.e., similar year, equipment, condition, etc.) in today's market. It's possible, however, to overinsure or underinsure to your detriment, so be sure to choose the value carefully.

• If you overinsure, in some cases the insurance company must repair the aircraft rather than total it, even when there's major damage — leaving you to deal with significant damage history and no compensation for the loss of value when your aircraft is repaired and returned to service.
• If you underinsure, in some cases the insurance company will total, rather than repair, the aircraft. You may not be compensated for the amount needed to replace your aircraft with one of a similar quality.

And remember to consider repair costs. If you have an aircraft without a ready supply of parts, or face other issues that drive up repair costs, factor that into your hull value decision, too.

Accident forgiveness is available on select insurance policies underwritten by AIG Aerospace Insurance Services, Inc., USAIG, Old Republic Aerospace, Starr Aviation, Global Aerospace and U.S. Specialty Insurance. This valuable coverage enhancement waives part of the policy's deductible and — even better — prevents the policy renewal rate from increasing as a result of the accident.