RV Insurance Values RV-14A

[Frankster13]

The tax assessor values my 2020 RV-14A at $240,000 but my Avemco Insurance will only value experimental aircraft at a max of $200.000. What gives? And this was after I got the tax assessor to review/reassess my value. I could not get them any lower. Question: Am I under-insured? I do have state of the art Garmin touch screens and all the bells and whistles. Can anyone recommend an Insurance option?

 

[dmattmul]

Global Aerospace

250k and 1 mil liability, 250k passenger. Very reasonable.

The problem with 200k all it takes is 100k in hull damage and it's a write-off. The engine and avionics are worth more than 100k (most of the time, the other you don't care about) so easy to total. Effectively you are getting $ 100,000 of insurance, in most cases.

 

[RV7A Flyer]

When first looking for insurance, I got a quote from Avemco that was nearly double what Gallagher was. And every year since then, I get correspondence from Avemco that is always about that factor of 2 higher.

 

[Ed_Wischmeyer]

The problem with 200k all it takes is 100k in hull damage and it's a write-off. .

Hmm. I'm right in the middle of that with Smokey, the RV-9A. The insurance investigator says that 70% of hull value is the threshold for write-off.

Still waiting to get an estimate from the (severely overworked) shop on the field so that I can give that to the insurance company so they can determine the settlement they'll offer...

 

[dmattmul]

Mileage may vary

Hmm. I'm right in the middle of that with Smokey, the RV-9A. The insurance investigator says that 70% of hull value is the threshold for write-off.

The OP was asking about insurance for a 14 which he can only get 200k of hull damage. The financials work out (for the majority of incidents) the following, again for a 14. He has an issue that has a decent repairm. . The insurance company writes him a check for 200k. The damaged airframe is sold for 100k. (A damaged well equipped 14 would be worth at least that (engine and avionics are more than that in a 14)). He could have done the same. (Sold the airframe). He effectively purchased $ 100,000 of protection. The 70% rule might be correct for your airframe and insurance value but for a 3 year old 14 probably not relevant.

 

[lr172]

The OP was asking about insurance for a 14 which he can only get 200k of hull damage. The financials work out (for the majority of incidents) the following, again for a 14. He has an issue that has a decent repairm. . The insurance company writes him a check for 200k. The damaged airframe is sold for 100k. (A damaged well equipped 14 would be worth at least that (engine and avionics are more than that in a 14)). He could have done the same. (Sold the airframe). He effectively purchased $ 100,000 of protection. The 70% rule might be correct for your airframe and insurance value but for a 3 year old 14 probably not relevant.

Not sure I see the reality in this. Airframe damage that is bad enough to require 75K in repairs (assume 25K for prop and engine) is almost guaranteed to involve a prop strike. Suggest you research the market value for prop strike engines. While used avionics carry a decent value, I don't think it is anywhere near $75-80K. I just can't see a seriously wrecked 14 bringing $100K at auction, even in this market.

 

[BobTurner]

He effectively purchased $ 100,000 of protection.

This is very convoluted logic. Didn’t the hypothetical owner think he purchased $200K of protection? Didn’t he receive a check for $200K? It’s true, in this case, that the insurance company’s net cost was less than $200K. Do you think they should rebate some of the premiums? That’s not how insurance works.

 

[RV7A Flyer]

The 70% rule might be correct for your airframe and insurance value but for a 3 year old 14 probably not relevant.

As I understand it, that 70% figure is applicable regardless of insured value or age or type. At least, that's what I was told by the insurance folks.

Unless you know something different?

 

[dmattmul]

Not that difficult to figure out, I think

This is very convoluted logic. Didn’t the hypothetical owner think he purchased $200K of protection? Didn’t he receive a check for $200K? It’s true, in this case, that the insurance company’s net cost was less than $200K. Do you think they should rebate some of the premiums? That’s not how insurance works.

Sure, he received a check for 200k BUT if he had no insurance, he could have sold the 14 for its residual value (assuming 100k if he had a recent panel and, in this case, engine was only 3 years old, my numbers make up your own) so he would have been out 100k. No rebate, just understand what one is really purchasing. 200k - 100k = ??

My input here is to have a more informed customer base. (Ignore if you want and stop reading) We need to be able to compare the insurance we are really getting to compare not only different insurance companies but different policy limits. Let's use the bulk of the fleet (6, 7, 8 and 9's) and not 10's or 14's which seem to have a premium over the rest. To compare different rates, we need to assume a certain salvage value. If we don't one might say a 150k hull damage insurance is worth 50% more than a 100k hull damage insurance and so the value is 50% more and we believe PAYING 50% more is ok. The truth is it's worth more than that as the salvage value is the same (Assume 50k salvage) so we are purchasing 50k worth of additional insurance (For the 100k policy) and 100k of insurance for the 150k policy. We are getting twice as much value (50k vs 100k) and so we need to understand that.

 

[BobTurner]

To compare different rates, we need to assume a certain salvage value.

????
But, in some accidents, the airplane burns to a crisp, there is no salvage value. The insurance companies set their rates using historical data: some total losses, some with some salvage value, many with $20K in losses. Many insureds never make a claim. They promise to ‘make you whole’. In general rates don’t vary that much from one company to another, suggesting they all use pretty much the same statistics.

 

[RV7A Flyer]

Sure, he received a check for 200k BUT if he had no insurance, he could have sold the 14 for its residual value (assuming 100k if he had a recent panel and, in this case, engine was only 3 years old, my numbers make up your own) so he would have been out 100k. No rebate, just understand what one is really purchasing. 200k - 100k = ??

My input here is to have a more informed customer base. (Ignore if you want and stop reading) We need to be able to compare the insurance we are really getting to compare not only different insurance companies but different policy limits. Let's use the bulk of the fleet (6, 7, 8 and 9's) and not 10's or 14's which seem to have a premium over the rest. To compare different rates, we need to assume a certain salvage value. If we don't one might say a 150k hull damage insurance is worth 50% more than a 100k hull damage insurance and so the value is 50% more and we believe PAYING 50% more is ok. The truth is it's worth more than that as the salvage value is the same (Assume 50k salvage) so we are purchasing 50k worth of additional insurance (For the 100k policy) and 100k of insurance for the 150k policy. We are getting twice as much value (50k vs 100k) and so we need to understand that.