If all the brokers source from a few companies, then it would seem the real variance in price (for the same coverage/company) is found in what the broker packs on as his/her commission. Is this correct??
And if so, is there a way to have the broker do an itemized list of the charges??
Thanks for sharing your knowledge in this somewhat confusing arena.
Mike - the broker is not allowed by law to add any fee to any policy he/she sells. Brokers don't mark up insurance packages and then resell them to you. They are paid on commissions dictated by the insurance companies. And they're all basically the same - usually 15% of the total premium is brokerage commission. They don't vary broker to broker or company to company.
The variance you are seeing is based on several things (roughly in order of significance):
1) prices are very market driven and change all the time - If I placed your coverage in December of 2009 and then placed an EXACT same risk in July of 2010, you'd find the pricing to be different and maybe even a different insurer having the best quote. The more volitile the market is, the bigger the variance from month to month or even day to day.
2) aircraft owners all request different values. RVs are insured for hull values all over the board. Each different value will generate a different premium.
3) No 2 two pilots are the same. Age, ratings, total hours, recent hours, TW time, make and model time, etc all make some difference in the premium at the end of the quoting process. And ther's no standardized formula for taking these factors into account. All companies quantify them differently with respect to premium.
4) Of limited significance, geography can make a little bit of difference. States with less friendly insurance or liability regs can affect an insurers willingness to accept risks inthat state. Risk of hurricanes in coastal areas etc.
5) Various companies can apply various discounts and credits. AOPA, EAA, FAST cards, IAC memberships, etc can be applied, depending on the company.
6) Then throw in an occasional owner that insures for liability only or Not In Motion hull coverge, etc.
So that's why it's hard to say that the insurance cost for a hangared RV-7A is $1,875 a year. There are a lot of variables. I would love to get a GOOD market survey of RV insurance rates. With enough accurate data (not the "I think I paid..." that is so common) you could start to see some trends. But then the market forces would shift it around, so who knows.
More and more, the insurers are using computerized quoting systems to generate quotes on small airplanes. A whole bunch of info is dumped into the computer (again, each company asks for different stuff) and then some magic formula generates a number. If few companies still quote by hand, and most apply some personal consideration to "other than standard" situations (ie low time pilots, students, etc.)
Bottom line - Find a good broker who sounds like he knows what he's doing and sounds like he cares about you and who you can reach when you need him and trust him to shop the market for you and find the best prices and terms. That's what you pay them for.
