AX-O

AX-O

Well Known Member
I have read under the EAA section that explains insurance and other places but I still don't know if this is a good enough, more than I need or just right. I am the process of buying a Cessna 140. The value of the aircraft is 20K. Can you guys please advice a newbie? The medical expense coverage looks kind of low to me.

AIRCRAFT LIABILITY
$1,000,000. each occurrence Combined Single Limit bodily Injury and Property Damage with $100,000 per passenger seat limit.

MEDICAL EXPENSE COVERAGE
Limit of Liability: $3,000. Each Person, Including Crew

PHYSICAL DAMAGE COVERAGE
Coverage provided on an All Risk Basis. The Insured Value of the aircraft is $20,000 subject to the following deductibles: $100.00 all losses.
 
Auto...

Axel... see what coverage your car policy says for the same line item (Medical)...

gil in Tucson
 
I asked the same question

The answer I got was the medical expense is just what they pay out no problem, basically covers getting your PX to the hospital (heaven help you if you have to have them life flighted)...

The 100,000 is what they will pay for the rest of whatever they claim (I guess they maight to sue to recover).

basically its just woefully inadequate period.....There is an unfortunate kid that has recently broken his neck on the skislopes. Medical is running and estimated 30 to 40,000 dollars per day! In other words 100k will be burnt up in 4 days and you won't be living in your house any more!

But then if you took no risks then life would be very boring and you certainly wouldn't b flying...

Doomsday Frank..7a
 
Read the fine print

ITS REALLY EXPENSIVE

ITS SOMETHING YOU PAY FOR BUT HOPE YOU NEVER USE

IF YOU EVER USE IT YOU MAY NOT CARE OR NEED IT (DEAD)

INSURANCE COMPANIES ARE IN THE BUSINESS TO MAKE LOTS OF MONEY, AND LIKE LAS VEGAS, THE HOUSE LIMITS THEIR LIABILITY AND MAXIMIZE THEIR ODDS SO IN THE END, WHAT EVER HAPPENS, CHANCES ARE THEY WILL BE OK FOR SURE, YOU HOWEVER MAY BE NOT SO MUCH.

PS well said frankh, sobering but true
 
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Liability

AIRCRAFT LIABILITY
$1,000,000. each occurrence Combined Single Limit bodily Injury and Property Damage with $100,000 per passenger seat limit.

My insurance agent says that chances are a crash will cause a smoking hole in a farmers field and the largest liability risk is for the person in the passenger seat. Therefore have your underwriter remove that 100K limit on the passenger.

Combined single limit should cover all liability, including to family, some underwriters will and some will not (Canada) remove that passenger limit.
 
It is not so easy any more to get the sublimit removed; I have 1 million "smooth" (i.e. no 100K sublimits for passengers) on the 172, but no one would write me a policy with smooth limits on the 170. I think this is for two reasons - it is a taildragger, and it will be 60 years old next year. In fact, there are fewer companies that will write policies for planes that old period, especially if they have fabric on the wings!

T.
 
Insurance explained

Three simple steps to understanding how insurance companies work.

1. Collect premiums.

2. Pay as few claims as you can.

3. Put the rest in the bank.

Mike
 
I actually sat thru a seminar at snf this friday that was put on by eaa insurance, it was very infomative and well hosted by a gentelman named Bob ( I can't recall his last name), I would reccomend calling them, I'm sure they can provide you with prices and options
 
Can anyone comment on the viability of smaller insurance companies, for example; Jim Pappas insurance being advertised on the left side of this page?

Do smaller companies generally charge less?

Has anyone had any problems with smaller companies paying claims?
 
Jim Pappas is an agent---(broker?), not an insurance company.

He sells insurance provided by others.

He is also a nice guy to work with, from personal experience.

Mike
 
To answer your question directly, No. No one can explain aircraft insurance. It's incomprehensible, just as the writers intended.
 
Understand that hull coverage is in essence a contract between you and the insurance company in which they agree to buy your airplane, or what is left of it, for an agreed upon amount. If you insure your hull for a too low value then, in the event of a claim, the insurance company will be quick to "total" it, sell the salvage, and pocket the proceeds. You can bid on the salvage if you want your airplane back. Or you can decline their offer (ie: withdraw your claim) and keep your damaged airplane, and they keep your premiums.

I haven't been able to get "smooth" liability coverage for many years. As a result, I take far fewer people for airplane rides nowadays.
 
This is the first time I have visited this forum and want to make myself available for any questions you may have. Whether or not you are our client, I will answer your questions as fairly as possible, no strings attached.

Here are my brief credentials: I was an aviation insurance adjuster for 4 years for US Specialty and Avemco, I was an underwriter for 3 1/2 years with USAIG (not a big vans market), now I am an aviation insurance agent with an office that handles over 1300 Vans customers

Here are some basics:

Physical Damage: The "hull" coverage or physical damage coverage is to protect your physical aircraft from a partial or total loss. Under most aviation insurance policies this is a stated or agreed value coverage meaning - the amount of coverage you purchase whether it is $20,000 or $200,000, if your aircraft is deemed a total loss that is the payment you will receive less any applicable deductibles. You do what to keep your value close to what the open market would bear for you selling your aircraft plus or minus extras you may have that would make the aircraft above average. A total loss is determined differently by the various carriers, some use a 70% rule - meaning if the costs to repair your aircraft exceed 70% of te value, they will total your aircraft and pay you the agreed value and sell the salvage via silent bidding. Other will take competitive repair bids and compare it to salvage estimates and if the two amounts added together exceed the agreed value the aircraft is a total loss. Very rarely do the carriers break even on a loss by selling the salvage if the aircraft is insured for the proper value.

Deductibles: With many of the main RV carriers, AIG, Global, US Specialty the deductibles are pretty standard and not adjustable. they tend to vary from 0 to 2,500 for an in motion loss.

Liability: Although some think insurance is a rip - off this coverage is the best piece of cushion you can buy for your passengers and your estate. Basically on most policies you have $1,000,000 for bodily injury and property damage to people and things outside the aircraft. If you crash into a house and injure someone in the house the coverage pays for the damage to the house and the injuries to the individual up to the $1,000,000 limit. The $100,000 per passenger is part of that limit and protects anyone you may be carrying as a passenger. Most liability policies for two seat aircraft run from $300 - $800. Pretty inexpensive if you crash into a house and kill some people. $1,000,000 is a good initial cushion before it reaches your estate. This coverage would also apply should you hit another aircraft and do damage to it. Only one company has an additional clause to this coverage and it is Avemco - they have an addition sublimit for family members of 25% or in this case $25,000.

Medical Payments: This is a no-fault coverage that pays the initial medical costs associated with a injury claim. This coverage also applies to the pilot even if he is the owner. It is used to help cover deductibles and co-pays for your regular health insurance.

The insurance companies are in this to make money - if they didn't you would not have the option to insure you aircraft because they would be broke. Some years they make an underwriting profit - some years they do not. Take for instance a recent claim I saw, the insurance carrier collected $8 in earned premium and paid $85,000 for the claim. It was a total loss. They may depending on the equipment on the aircraft get $15,000 to $20,000 back in salvage. So the net loss to the carrier is $65,000. They then have to insure 26 airplanes at $2,500 in premium a piece to make up for that loss.

The best things that keep rates down are competition and good loss histories. If a certain line of airplanes have a good loss history other carriers may catch on and quote competitive rate, if the losses are high the competition stays away and the carrier is forced to raise rates to cover losses.

I hope this gives an Insurance 101 for everyone and let me know if you have any questions.

Dave McCoy
NationAir Insurance
877-475-5860
 
Dave,
I'm glad that you mentioned that 25% limit for family members from Avemco. I had Avemco insurance for many years before I discovered that clause. And since my wife, also a pilot, flies with me about 97% of the time, it was a real eye opener for me.
 
Over insured?

Consider if you have medical coverage from your employment to cover your injuries and also consider your probability of liability versus how attractive you want to be to those who would want to sue you. If you park/taxi close to super-expensive airplanes perhaps a high liability coverage is warranted, but a soybean farmer just might sue you because you're worth a million.
 
Earned premium is the amount of premium the insurance company keeps in the event a policy is canceled for any reason. Effectively it is similar to paying by the hour. The amount of earned premium varies by the method of calculation. If a policy is fully earned, the insurance company is entitled to keep all the premium of the policy from the first day of coverage. Some short term policy or endorsements are done this way. Vary few if any main policies in aviation have this. Most policies are earned as you go. For instance the insurance company is paid in full up front. If you sell your aircraft during the policy period - you are in essence canceling the policy and due a return. That return is figured either pro-rata (daily rate of total annual premium divided by 365) or short rate - similar to Pro-rata but is weighted so that you daily rate earlier on in the policy period is larger than towards the end, effectively you pay more if you cancel the policy earlier.

Keep in mind; most policies spell out how they will return your premium in the event of a cancellation due to a total loss, cancellation by for any reason the insured, or cancellation by the insurance company.

Here are some examples:

Your premium: $2,500 and you cancel 90 days into policy due to sale of aircraft. Because your at the one canceling your policy will likely say the returned premium to you will be figured ?short-rate? or ?pro-rata with 10% penalty?

Amount returned to you:
Short rate: $1,625
Pro-rate plus 10% penalty: $1,694
Pro-rate: $1,882

If the carrier were to cancel pro-rate only no penalty:
Now if the same scenario happens later in the policy period the difference between the two cancellation process is smaller

If you have a policy for 270 days your return would be:
Short rate: $500
Pro-rate plus 10% penalty: $585
Pro-rate: $650

Hope that did not muddy the explanation

Dave McCoy
 
Thanks for the inside info.

One question:

For a given pilot in a given airframe will a taildragger be more expensive than a tri-gear? I.E. would a -7 be more expensive for a given pilot than a -7A?
 
Typically only a few hundred dollars or - 10- 15% with the A versions being less expensive. the spread tends to be greater for lower time pilots with lower tailwheel times
 
NationAir said:
Typically only a few hundred dollars or - 10- 15% with the A versions being less expensive. the spread tends to be greater for lower time pilots with lower tailwheel times
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That's exactly what I expected you to say, thank you.

Hrm... thinking about a tail-dragger but am trying to cut operational costs to the bone.
 
Builder's Insurance?

The rate's I've been quoted for builder's insurance seem to very high given the minimal risk. Right now my "airplane" is really just a bunch of expensive stuff sitting in my garage. It doesn't move, it has no passengers but it's not covered by my homeowner's policy.

It seem's like the premium is at least 1% of the value. I had one broker that quoted over 1% of the "end value" (about $1K on a $90K plane) even though it's only worth half of that right now. Seems very high compared to auto or homeowner's insurance where the risks are much higher.

So far I've gone without insurance.
 
Rick_A said:
So far I've gone without insurance.
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Until we purchase some of those high dollar instruments that could be tempting someone we don't have much more in our garages than we would were we to work on any other project of this magnitude (i.e. hot rod car in pieces, restoring an old boat, building a motorcycle, etc.). So how much would anyone worry about insurance on any of those types of projects?
 
RVbySDI said:
Until we purchase some of those high dollar instruments that could be tempting someone we don't have much more in our garages than we would were we to work on any other project of this magnitude (i.e. hot rod car in pieces, restoring an old boat, building a motorcycle, etc.). So how much would anyone worry about insurance on any of those types of projects?
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What would a new kit cost to replace a burned out project?
Just trying to play devil's advocate.
 
Devil's advocate

To expand a little on Mel's logic on builder's insurance, it is all about what you can afford to lose. If the house/hangar burns down or is storm damaged you lose. It is a personal call.
 
Rick_A said:
The rate's I've been quoted for builder's insurance seem to very high given the minimal risk. Right now my "airplane" is really just a bunch of expensive stuff sitting in my garage. It doesn't move, it has no passengers but it's not covered by my homeowner's policy.

It seem's like the premium is at least 1% of the value. I had one broker that quoted over 1% of the "end value" (about $1K on a $90K plane) even though it's only worth half of that right now. Seems very high compared to auto or homeowner's insurance where the risks are much higher.

So far I've gone without insurance.
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The reason they're expensive is because the insurance companies lose money on them. This has been discussed in the past. On a policy that pays out $90K, that's over 100 $900 policies that have to be sold just to cover one payout. And it's more than that, because they still have to pay the people who work for them, etc. You might think that houses don't burn down all that often, but the odds are better than you might think. There are 3 houses in my neighborhood that have burned down in the past 2 years, all unrelated, one arson, one grease fire, one grilling accident. I think I'll keep my builder's policy just in case.

PJ
RV-10 #40032

PJ
RV-10 #40032
 
I think John said it right it is a presonal call and depends on what you can afford or are will to risk losing in a worst case scenario. In the end an insurance policy is only worth the premium if you have to use it. Also, you may want to let your significant other know the potential exposure. They may be a little upset if your place burns down and you rebuild and the check for the cost to replace contents has to pay off the airplane - she may not like sitting on a folding chair watching a black and white TV in her newly rebuilt house. :) Sorry, just an insurance sales jab.

Dave McCoy
 
Don't have an accident

I had coverage with AIG on a RV-3 and I flipped it over on landing. They were very professional and quick paying out the claim. Aircraft was a total loss. Now the problem is that they will not insure me for any RV or rotor craft wich I am commercially rated. I don't have a ton of time only about 750 but because of that claim I can't even get insurance on aircraft that I could get when I had 100 hours. Seems like a bunch of BS to me. I guess I'll go back to flying C-140 for a couple years and not give them any more money!!

Brett
 
I had coverage with AIG on a RV-3 and I flipped it over on landing. They were very professional and quick paying out the claim. Aircraft was a total loss. Now the problem is that they will not insure me for any RV or rotor craft wich I am commercially rated.
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Bum deal.

That is one reason I only carry GNIM (ground, not in motion) coverage on my plane. If I twang the plane, I rather repair it at my cost instead of putting future insurability at risk. If I really wad up the plane......I may not be around to worry about fixing it. It is a matter of deciding how much risk you are willing to assume.

GNIM still provides full liability coverage at all times, and full hull coverage until the engine starts. Premiums are a lot less than inflight full coverage.
 
NationAir said:
This is the first time I have visited this forum and want to make myself available for any questions you may have. Whether or not you are our client, I will answer your questions as fairly as possible, no strings attached.
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Can you shed any light on this Dave? Or if anyone has heard any stories or has any personal experience, please speak up.

mh53j said:
I had coverage with AIG on a RV-3 and I flipped it over on landing. They were very professional and quick paying out the claim. Aircraft was a total loss. Now the problem is that they will not insure me for any RV or rotor craft wich I am commercially rated. I don't have a ton of time only about 750 but because of that claim I can't even get insurance on aircraft that I could get when I had 100 hours. Seems like a bunch of BS to me. I guess I'll go back to flying C-140 for a couple years and not give them any more money!!
Brett
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Sam Buchanan said:
That is one reason I only carry GNIM (ground, not in motion) coverage on my plane. If I twang the plane, I rather repair it at my cost instead of putting future insurability at risk...
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Is it a standard insurance industry practice to deny liability coverage due to a previous totaled hull claim?!? Would this apply to every company (I know there are very few writing aviation policies), or just the one you were doing business with? I would think they would just charge you an arm and a leg next time, not ?black-ball? you forever.

I find this hard to believe, but if true I agree with Sam. Wouldn?t the cost of replacing a single plane be a small price to pay, verses risking everything you own by flying with no liability coverage?

Tom
 
Top Secret Clandestine

Like political & religious affiliation or how much you earn a year, some things are not discussed freely in polite company. A taboo topic seems to be aircraft insurance premiums. Its like a big secret. May be its not a secret and an insurance sales man will give you the "formula" to calculate the rate and its black and white.

I may be naive but can you negotiate your rate? :rolleyes: (don't laugh at me :eek: )

Are insurance rates pretty close and evenly calculated (ie fair) or are they all over and what ever a customer is dumb enough to pay (without crying)?

The RV Community should start a data base with agents / underwriters rates, hull value, limits and pilots #'s. May be people don't want to share what their insurance is costing them, because its private? I understand. With that said, what is everyone paying. :D

PS: As far as insurance companies dropping or black listing, they can do what ever they want. There may be state laws regarding automotive insurance that requires them to make it available for high risk car drivers at a crazy higher rate, but for planes I doubt they have to provide coverage to anyone. Like a restaurant, no shoes, no shirt, no service. For 25 years I have known the FAA does not determine who flys what and what ratings and hours they need, the insurance companies are the ones that call the shots.

It seems that with a large fleet if we had a co-op and went to an insurance company as group to GIVE or PULL our business we might have more leverage. The premiums on all RV's in the USA per year must be huge. Its a matter of being organized. I don't know how agents are paid, but I am sure they can cut their CUT for a group? Again, may be I'm naive per rule one for insurance companies: Take in a much money as possible and pay out as little as possible.

PJSeipel said:
The reason they're expensive is because the insurance companies lose money on them. This has been discussed in the past. On a policy that pays out $90K, that's over 100 $900 policies that have to be sold just to cover one payout....... There are 3 houses in my neighborhood that have burned down in the past 2 years, all unrelated, one arson, one grease fire, one grilling accident. I think I'll keep my builder's policy just in case. PJ
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PJ no offense but insurance companies make money like crazy, in general they are the richest companies on the planet, so don't feel sorry for them. It is STANDARD propaganda from insurance salesman that they don't make money (as they drive off in their Rolls Royce). BULL. Also $900 plane policy? Try $3,000. A $90K hull is going to be more like $2,000-$3,000?? Never the less you have a point. However they also have more than 100 policies, they have a 1,000 $2,000 policies ($2 mil), so they can afford one $90k hull. Also when the big storm hits the insurance companies, they can and do just fold. Basically insurance is gambling.

Last if you have had three houses burned down in the hood, first where do you live, second may be you should move? :rolleyes: Statistically you may be better off staying, if they caught the arsonist and your don't live next to grease-monkey Joe or BBQ Barny, aces. :D What are the chances? Is there a Meth lab next door? :rolleyes: )
 
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gmcjetpilot-

Sorry I am a rookie at replying with multiple quotes so I think answers most of your questions in order.

1)It is in black and white on some policies other it would have to be given to you, but the rate is not secret. to find the amount you pay for Physical Damage coverage take your hull premium and divide by the value - this is the rate per $100 in valuation. Both the hull and liability will vary with the following factors: pilot credentials, number of pilots, make and model aircraft, seating, location of aircraft base, use, and some others.

If you do not see it, just ask your agent.


2)Not really. Typically the RV rates are set and you take what you get. However- that being said - occasionally on a renewal, if you have been with a company for a couple of years, the agent may be able to get your current carrier to match or come close to the other companies premium if it is lower.

3)The rates are typically based on loss experience with in a certain make and model or group of aircraft.

4)Not a bad idea, but the key to making this type of data base you have to have the variables mentioned above - and there are a few more - to keep from having everyone wondering whey they are not all paying the same premium. This would be a big undertaking, but maybe useful.

5)Actually - PJ is correct. Having been on all side of the fences here, not all insurance companies, make money all the time. When they don't they raise rates or get out of that line of business. But moves like that usually follow the loss of large amounts of money. Phoenix Aviaiton Mangers used to write the Vangaurd program and two years ago they had to drop the progrma after losing money in it all three year it exsisted. Some years they are successful - others they take it in the shorts. You can say the yes ultimately they are financially strong, but I would rather have them make enough money so that when it comes time to pay a claim they can. Better that then finding out they are belly up.

It is not my standard propaganda nor my agents, that we make those statements, and I drive a 2000 Camry with 120,000 miles, so far from the Rolls Royce - I do get to look at them everyday when I come to work as they sit on the car lot. LOL
 
Insurance - long

Guys,

I have hesistated to reply, especially since I was with the RV group last week on the Carribean RV trip, but more because this is like primer/not, tip up/slider,7,8,9,etc.

My wife is blond, how about yours...?

What's that got to do with RV Insurance? Plenty!

We are all different. We are all building and flying RV's for different reasons. These are not spam cans but then we know that.

I'm in the business for different reasons than most if not all full time, Big brokerage house, any kind of aircraft Insurance folks. Nothing against them, I owned an Independant Auto, Home, Boat, Business, etc practice for 20 yrs.

Then I got hooked on an RV9A which got sold in the early stages when the 7A came out and the bride found out the 9 wouldn't do acro and she promptly gave me permission, in Van's booth at OSH to sell the 9 and get the 7.

I am one of those low time, long term builders with a million questions of how to do this and that and got talked into writing policies for our group when Phoenix left the market.

I have had a blast and this is the best bunch of folks I have ever met but we all have different tastes.

That's why I asked about tip up, wives, etc.

I have sold all my insurance practice except for now I ONLY sell RV Insurance. Oh, if you call my office you get me. I'm the only employee/agent. That's all.

Can I write your other planes, yes, but I prefer to write RV's but wil take care of my friends.

Am I gonna get that Rolls that was mentioned doing it? Nope. I'm a pickup kinda guy anyway and I have a plane to finish.

Bottom line, no mumbo jumbo or fancy insurance formulas (no offense Nationair - his info was good stuff) but to me Insurance has never been about mystery meat, it's about the same personal preference that made us chose RV's over spam cans or Blonds over Brunettes or to prime our plane even if we today never plan on going to a place like the Turks/Bahamas - (Prime it just in case - if you can - I will now that I've been - your call).

Point is, if you don't belive in insurance or don't like it - fine. I'm not going to try to change your mind. I probably can't. Probably anymore than I can convince you that the wheel should be in the front not the rear or vice versa.

It should be no different than a go/no go call. If your Common sense has a problem with it somethings not right, ask questions, get it in writing. If you feel ripped off while I may never convince your not maybe if I go over it with you and YOU choose what you want to gamble on at least it's YOUR EDUCATED CHOICE.

I have been following this thread all week when I could from the trip, email was spotty and cell calls were $2 a minute so I waited until I got home tonight to reply.

I hope I don't get flamed, I don't mean to step on Nationairs toes, he's trying to help. I almost don't want to post this but i hope you guys get where i'm coming from.

Oh, since I'm still only into it about $2000 I DON'T have any builders insurance, yes I take a risk if someone gets hurt then my home policy medical/liability (in Illinois and most states) will not pay but I don't have people near it so little chance someone will so no insurance for now...my choice.

When I order the next set of kits and that risk goes up I'm plopping down for a policy and no I don't get a break. Same prices as you guys. I am a builder who happens to have 20yrs experience in Insurance and 2-3 in RV Insurance.

Get all the info you can, from someone you feel confortable with, even if it's Nationair, Sky Smith or even me, then make the decision that makes you feel as good about your personal choice as which options you bought from Van and go fly the darn thing and if we meet at OSH or Sun N Fun or someplace else I'll buy you a brew or a pop and you can argue with me all you want...and guess what...I'll probably tell you that for you -- you're right!

Blue skies all, hope a little different "insurance salesmans - (semiretired) RV builders view might help after all. Hope it did.

Hope it makes sense, I just realized it's 3AM and I got up for the return flight about 20hrs ago. Night all.

Be well all.
 
Can you afford NOT to insure.

Having hull insurance (or not having hull insurance) on your aircraft is not about whether you can afford the insurance...it's about whether you can afford NOT to have the insurance if you total the plane.

Look at it this way. Your RV may be worth $80k on the market. Think of that as a bag of money you own. If you have no insurance and you total the plane one Saturday afternoon when you ground loop it on roll-out you lose all your capital. It's the same as taking your bag of $80k to the park and getting it stolen while you sit on a park bench in the sunshine eating a sandwich.

If losing a bagful of $80k in the park one sunny afternoon wouldn't even put a dent in your total capital resources then you probably don't need insurance. If on the other hand it would be a financial catastrophe for you (and I would suggest it would be a catastrophe for most RV owners) then that means you cannot afford to be without insurance.

In other words it's a Catch 22 situation. Those who can least afford to insure are generally those who need it the most.

Cheers Bob Barrow
 
Hard to justify

I have to agree with gmcjetpilot on many points. I am a low time pilot and my dealings with insurance has been anything but pleasant. Just try to get a tail wheel policy as a low time pilot. FAA is fine with me but it is impossible to get a practical insurance policy. Add to that the 'blocking' policy and lack of agents and things get much worse. I have a buddy with a M5. I started inquiring about a policy to fly his plane last month. I was literally told by his agent that if I went to a different agent or kept inquiring that I would potentially impact my friends policy causing a possible denial of renewal or rate increase! :mad:
Why isn't this community up in arms over this? We need to worry about more than a new gas tax when the insurance companies will end up killing aircraft ownership.
 
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My friend insures his 2006 Porsche Carrera 4S for around $2500 a year. He has a good driving record and the car is worth about 90k. This seems to be about what folks would spend for ground and inflight coverage on a RV. I really don't see the issue here. Now if he wrapped it around a tree, and went to insure the next one, i'm sure they would jack his rate (makes sense). Further more, if the insurance company caught wind of his 16 year old son taking it for a joy right, they would probably threaten to raise his rate or cancel him (makes sense).

Insurance is all about the odds. The laws of large numbers show that experienced pilots, with no know accident history, flying relatively inexpensive modern planes, are good bets. They will of course need to collect more money for pricier planes, less experienced pilots, and pilots with know accident histories to ensure that they stay in the black.

No offense to anyone in this true awesome community, but if I were an insurance company, i'd rather collect $2500 to insure a 40 year man's Porsche than collect $2500 for a 40 year old man's RV. There is just something about 3-axis of control, mechanical, weather, medical, and a host of other risks that aren't quite as prevailant with automotives.

The fact that there are three or more good agents competing for our business and several good companies willing to underwrite it is good for all of us. Insurance isn't driving people away from aviation, it is enabling the middle class (a group with a lot to lose in the event of an incident) to own and fly airplanes. I know I can't self insure an 80k plane, car, or boat - and the second I slammed it into someone or something, I know I would feel pretty bad selling my house and everything else I owned to pay damages / reperations.

On another note, if you really want a good discussion, come join me on the Rennlist forum (Porsche Racing) and try to help me figure out how it costs $270 a day to insure my $12k car on the track...

Don't mean to offend anyone - just adding my 2 cents...
 
Porsches...

ChrisL said:
My friend insures his 2006 Porsche Carrera 4S for around $2500 a year. He has a good driving record and the car is worth about 90k. .........
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He should take up flying.... :)

$70K hull and liability on my Tiger is $1000 per year.... one of the few advantages of a certified plane...

gil in Tucson

...or perhaps the rate says something about Porsche drivers... :D
 
Blocking

*From the Avemco web site:
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?Blocking? is the practice in the aviation insurance industry in which an agent or broker submits your aircraft N number to an insurance company asking for a quotation. Once quoted to that agent, the insurance company will not provide a quotation to any other agent, unless the new agent provides an Agent of Record letter replacing the original agent. This essentially ?blocks? you from obtaining competitive quotes from other agents that the insurance company deals with. The agent you called first will then select the coverage and price that he or she will present to you.
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This is what I find amazing about aircraft insurance. You can be held hostage by the broker! I got caught in this when I tried to shop for a better rate. The existing broker would not even relate to me what underwiters he had spoken to but warned me not to go looking any further!
Can you imagine this on your homeowners or car insurance?
 
JD-

I think that statement is very misleading that Avemco has posted. First if you pick a good agent, you shouldn't have to shop. That is his or her job, that?s why they get a commission on the premium from the insurance company they place the business with. Second - a good agent will present you with all the quotes and help you decide which one works best for you. The Agents/Brokers do not set the price! The underwriters do. Agents get the best terms with up to date and accurate information from the risk. If each agent has the same information they would get the same quote. The quote is based on the risk presented not who the agent is.

It is unfortunate that the lower time pilots bear more of the burden, but in risk management they are typically higher risk than a more experienced pilot. The good thing is, your premium over the years will come down to a more manageable level as you gain the experience.

Dave
 
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