It?s probably no secret here, but I am an aviation insurance broker. While I have a handful of RV insurance accounts ? namely my family members, friends, and a few others I?ve collected over the years ? my bread and butter are accounts of a significantly larger nature. Corp flight departments, FBOs, maintenance shops, etc. Because of my professional interest in aviation insurance and my personal avocation of flying RVs (and other little airplanes), I typically monitor and contribute my $0.02 to the ?Insurance? topics discussed here.
I?ve noticed over the years that there sometimes creeps in a theme of ?insurance companies should lower their premiums for RVs. We are safer than the norm and the airplanes are better than the norm, etc... When will some insurer finally recognize this huge profit potential and give us a break??
Allow me to give some perspective, allowed by my view of the big picture that those outside the insurance business aren?t privy to.
I am currently working with a claim. The aircraft in question is an airliner being used as a corporate jet. Several months ago the airplane suffered MAJOR engine damage on both engines due to significant ingestion of FOD. The policy is written with a major aviation insurer ? one that is also one of the more common underwriters for RV policies. The annual premium on this policy is about $150,000 ? 100 times an average RV policy. This premium is actually historically VERY low, for this type of risk, due to the current soft market.
At the end of the claims process this insurer will have paid out about $11,000,000 for repair of the 2 engines, plus an estimated $2,000,000 in airframe damage and a host of expenses related to the claim.
The promised perspective ? If we estimate 4,500 insured RVs nationwide, each paying an average premium of $1,500 ? that?s $6.75 million in premium paid by ?us? RVers each year. That premium is spread over five or six different insurers, with two or three having most of them. The total premium of every RV in the country is half what this one insurer is paying out on this one claim on one airplane ? where nobody was even injured.
My point is that any of the insurers offering RV policies could decide tomorrow that they don?t want ANY of them ? and they wouldn?t even miss them. We occupy a VERY small little niche of the marketplace. It is very important for us to keep our noses clean and not give the insurers we have ANY reason to suspect that RVs might not be worth the trouble. Three or four high profile losses in a year could really make the difference for an insurer. The loss of a single market could easily double the premiums we pay. It?s that important. Fly Safe!
I?ve noticed over the years that there sometimes creeps in a theme of ?insurance companies should lower their premiums for RVs. We are safer than the norm and the airplanes are better than the norm, etc... When will some insurer finally recognize this huge profit potential and give us a break??
Allow me to give some perspective, allowed by my view of the big picture that those outside the insurance business aren?t privy to.
I am currently working with a claim. The aircraft in question is an airliner being used as a corporate jet. Several months ago the airplane suffered MAJOR engine damage on both engines due to significant ingestion of FOD. The policy is written with a major aviation insurer ? one that is also one of the more common underwriters for RV policies. The annual premium on this policy is about $150,000 ? 100 times an average RV policy. This premium is actually historically VERY low, for this type of risk, due to the current soft market.
At the end of the claims process this insurer will have paid out about $11,000,000 for repair of the 2 engines, plus an estimated $2,000,000 in airframe damage and a host of expenses related to the claim.
The promised perspective ? If we estimate 4,500 insured RVs nationwide, each paying an average premium of $1,500 ? that?s $6.75 million in premium paid by ?us? RVers each year. That premium is spread over five or six different insurers, with two or three having most of them. The total premium of every RV in the country is half what this one insurer is paying out on this one claim on one airplane ? where nobody was even injured.
My point is that any of the insurers offering RV policies could decide tomorrow that they don?t want ANY of them ? and they wouldn?t even miss them. We occupy a VERY small little niche of the marketplace. It is very important for us to keep our noses clean and not give the insurers we have ANY reason to suspect that RVs might not be worth the trouble. Three or four high profile losses in a year could really make the difference for an insurer. The loss of a single market could easily double the premiums we pay. It?s that important. Fly Safe!