Hi everybody, I guess I've been reduced to "lurker" status these days. Another subject worth looking into is where the insurance policy allows you to land. Many will not cover you if you land someplace other than an airport. The definition of airport varies, but essentially they don't want you doing first landings. So unless you can document that the beach you nosed over on has been used by airplanes before, you may not be covered.
Jeff

Believe it or not, I actually feel that it's not really out of line for everyone to be required to carry liability insurance. Just like with cars, the guy who's idiot enough to plow into you is also likely to be a deadbeat. Had it happen to me- a drunk hit me head-on and totalled out my pickup about 15 years ago. Luckily I was seatbelted up or he woulda totalled me out too. He had no insurance, no money, no nothing-- asshole!
I'd be pretty bummed out to have some nitwit whiz off the runway right into my airplane (bad enough!)- and then find out he has no insurance and no money either. I wonder if the courts would accept the old "he needed killing" defense in that situation?

Eric

donknee Thanks for that lead. I did get in touch with Ryan yesterday, he is a pilot, seemed to understand my concerns, and got me a competetive rate with AIG, who we felt would best cover my needs. He said he had never had any problems with them on covering a claim. Saved me about $300.00/yr. over Avemco and I got better coverage. Oh well, off to Costa Rica. Gary

Since I brought up the subject of not carrying insurance, I would just like to chime back in and say I was only referring to hull insurance. I think zero-one-victor is right, we all should be carrying liability insurance in case we hurt someone else. The cost of a serious injury to someone is likely to be 10 times or more what the value of our planes are.

Yeah, and the tendency today is to sue no matter what-- if you have much in the way of assets,even just an IRA or other retirement nest egg, you stand at risk if having it took away to pay "damages". Some people out there are always on the lookout for somebody's pockets to get into- and they don't even have to be very deep.

Eric

READ YOUR POLICY
IF your buddy dies in your airplane, his family gets $100,000.00 PERIOD
If you run over a lear on final you have $1,000,000.00.
THATS right the insurance will NOT pay up to 1mil for the loss of a life, but it will as you distroy property on the ground. The likleyhood of this kind of loss is VERY LOW.
AIRCRAFT INSURANCE IS A JOKE and if your buddy dies in your airplane and his wife and 14 children can't eat an attorney will take everything you have. first for attorny fee's and a couple of dimes will be left for the 14 children. If you don't have anything don't worry the attorney's will stay away.

Great news, Dipstick,

So---we should all stop our liability insurance???

That's why I carry $1 Million Smooth insurance.

MTV

And there's a problem with me not having to pay for the damage to the Lear 45 that I just groundlooped my $40,000 Cessna into?

pfftt... diptick

They may have changed by now but AOPA would not sell me coverage in Alaska nor would they cover me for off airport ops. At the time our home airport was chip coat and I hardly ever went to a paved airport so the coverage was worthless even if they would have sold it to me. So I didn't have hull damage. I have saved enough money on premiums to replace my plane twice now. Of course that don't mean I have the money to do so, it all went for engine work, paint, floats etc.
Shane

I wrote this because many cannot obtain the 1mil overall liability policy. Most pilots think they have 1mil to cover ANYTHING that happen's and this is not true. If more pilots ask questions maybe the industry will do the right thing.

MTV
You should explain what SMOOTH coverage is, many pilots have never heard this term. Also, the pilot skill requierments to obtain.
Thanks

dipstick wrote:READ YOUR POLICY
IF your buddy dies in your airplane, his family gets $100,000.00 PERIOD
If you run over a lear on final you have $1,000,000.00.
THATS right the insurance will NOT pay up to 1mil for the loss of a life, but it will as you distroy property on the ground. The likleyhood of this kind of loss is VERY LOW.
AIRCRAFT INSURANCE IS A JOKE and if your buddy dies in your airplane and his wife and 14 children can't eat an attorney will take everything you have. first for attorny fee's and a couple of dimes will be left for the 14 children. If you don't have anything don't worry the attorney's will stay away.

dipstick wrote:MTV
You should explain what SMOOTH coverage is, many pilots have never heard this term. Also, the pilot skill requierments to obtain.
Thanks

Dipstick...read the policy again. In most cases the policy only sub-limits the $1 Million overall limit for passengers. (Avemco limits on a per person basis and further limits family members to $25,000) This is due to the fact that passengers willingly took the risk to be in the aircraft. Bodily injury or property damage to non-passengers is not limited below the $1 Million overall limit. This is the reason for the $1 Million payout on the Lear that you referenced. Keep in mind as well that your liability covers defense and damages that you are held liable for even when you do not have an accident. Flying low and spooking a $1 Million race horse through a fence resulting in it's being put down, hope you have liability insurance if they get your tail number.

Your example of the lawyer taking all the $1 Million is incorrect. On most policies the defense cost are covered in addition to the $1 Million liability coverage not taken out of that limit. You are defended whether or not you were the guilty / negligent party.

Smooth limits refer to no sub-limit being put on the overall liability limit. In this case $1 Million dollars would not be limited in the event of passengers being injured. Smooth limits can be hard to get in basic pleasure and business aircraft. Tailwheel aircraft are next to impossible to get smooth limits. In order to get smooth limits most underwriters will require annual recurrent training in the make and model aircraft and a very proficient pilot with no loss history. The smooth limit is also more expensive to get.

yellowmaule wrote:I would love some expert advice, anyone with an opinion/experience, pitch in!

The value listed on your declaration page in the insurance policy is the agreed value of the check that will be written to you if the aircraft is totaled. You need to think of this value as what it will cost you to replace your aircraft because that is what you will have in hand to do so in the event of a total loss. If you insure your $80k Maule for $50k to save some cash and you perform a ground loop that dings the wing and gets the prop you can start looking for a replacement with a $50,000 check. It is solely up to the insurance company's descression as to if / when to total an aircraft. A prop strike will require engine teardown, prop work, shop labor, etc. and can easily run $20,000 not to mention the wing tip that must be repaired. In this event the insurance company will likely cut you a check for $50,000 and then list your aircraft on their salvage auction to recover their loss. Keep in mind that this is an auction. Many A&P's would gladly pay $50,000 at auction to purchase a slightly damaged Maule that was worth $80,000 before the prop strike? The A&P's will just do the engine teardown himself much cheaper than $20,000 and have a great aircraft when he is done. This scenario has the insurance company paying a claim and not losing a penny.

Always insure the aircraft for the amount it will cost to replace it, not what you paid for it. This may require some value substantiation if your replacement cost exceeds 15% of the bluebook, but a good agent should be able to help you with that.

Please understand that I am not trying to start any fights here or make any enemies. I am only trying to answer some questions that were asked and correct some statements that were made in order for everyone to fully understand the insurance industry. The more you know and understand, the better you are at making risk management decisions.

-Chris

I will again read my policy.
The attorney fee's I was referring to was If a wife hires an attorney AFTER she has lost her husband (and she will have to) in say my airplane or yours, most all of the proceeds will go to the attorney. This has nothing to do with the policy holder fee's, however no policy I can remember reading allows attorney fee's in excess of the limit's.
I have had muliple problems with insurance co's and it has ALWAYS required an attorney to get them to pay. The last law firm I used was Girrade & Keese, you may have heard of them, they handled the Erin Brokovich case when the original attorney almost went bankrupt fighting the case.
I make it a habit to read all of my policy's (eight) from cover to cover.
And I think all contributions to this issue are welcome, It is only when one attacks the author and not the substance of the issue that we should be alarmed.
It also helps to be a good writer, which I am not, to convey your words well.

Due to circumstances best discussed around a hanger or campfire, I managed to bend a wing, collapse a gear, and have a prop strike.

I had insurance by US Specialties which I believe is one of the Avemco companies and they were, what I considered, fair and fast in their settlement. When I pointed out that I had an essentially new three blade on the plane they readily agreed to a new prop instead of an overhauled one.

Only problem is USS does not insure Maules unless they are on floats at least part of the year.

I did learn one very useful lesson. Don't talk to any authority be it Police, FAA, or anyone else about an incident until you have contacted your insurance company and, hopefully, your aviation lawyer.

Anything that comes out of your mouth right after bending your plane is probably not well thought out but will be duely recorded by the local, state, or fed official on site and used in all following proceedings.

I just got my new quotes:

Global lowest

AIG next

Avemco highest

Coverages essentially the same w/ Avemco having higher deductible.

TD

dipstick wrote:no policy I can remember reading allows attorney fee's in excess of the limit's

Most of your aviation companies cover the legal fees independent of the policy limit, however, once the policy limit is met through judgement or settlement, there is no additional legal fees paid from that point on.

Example: 2 lawsuits are filed over one accident and the first one is awarded the entire policy limit for liability. The legal fees up to that judgement will be paid, but you are on your own with the second suit for both the judgement and the remaining legal defense cost.

I cannot speak to the legal fees in policies other than aviation as I do not deal with those lines of coverage.

TomD wrote:I had insurance by US Specialties which I believe is one of the Avemco companies...

Avemco is a stand insurance company and a competitor of US Specialty. They do not use agents and they only give you their quote. A good agent will shop all the markets available for you account and bring you all of your options to discuss them with you. If a company declined to quote, they should tell you that as well.

TomD wrote:Only problem is USS does not insure Maules unless they are on floats at least part of the year.

USSIC considers a Maule to be "special risk" and the quote submissions are sent to a separate underwriter than other pleasure & business risks. They do seem to write them on floats more than TW configuration for some reason.

TomD wrote:I did learn one very useful lesson. Don't talk to any authority be it Police, FAA, or anyone else about an incident until you have contacted your insurance company and, hopefully, your aviation lawyer.

Agreed...First call is to the wife (if applicable) Second goes to your agent or claims adjustor. This can save your bacon in many cases. Remember that your insurance will help with your defense in a legal situation and that means hiring professionals in aviation to appear on your behalf. This benefits the insurance companies as much as it does you since it may save a large judgement or ensure a low settlement.

TomD wrote:I just got my new quotes:

Global lowest

AIG next

Avemco highest

Coverages essentially the same w/ Avemco having higher deductible.

That sounds about right if you have at least 100 TW hours. Aerospace is usually a decent player with 100 TW hours as well. Avemco is often the cheapest if you have less than 100 hours TW. Avemco's liability coverages are not the same as those offered by Aerospace, AIG, Global, London, Phoenix, USAIG, or US Specialty. Refer to my previous post for some clarification.

-Low

dipstick wrote:READ YOUR POLICY
IF your buddy dies in your airplane, his family gets $100,000.00 PERIOD
If you run over a lear on final you have $1,000,000.00.
THATS right the insurance will NOT pay up to 1mil for the loss of a life, but it will as you distroy property on the ground. The likleyhood of this kind of loss is VERY LOW.
AIRCRAFT INSURANCE IS A JOKE and if your buddy dies in your airplane and his wife and 14 children can't eat an attorney will take everything you have. first for attorny fee's and a couple of dimes will be left for the 14 children. If you don't have anything don't worry the attorney's will stay away.

Right because you bought a policy with a $100K sublimit. Run over your buddy on the taxiway or crash into his house and the full million is available.

I am with aig. I just canceled my policy on my maule because it has been in annual for two months and probably will remain for another 2 months.
When I was with Avemco they would allow me to put my policy in idle (don't know the proper term) which would reduce cost it you did not fly.
This will bring the policy down in cost if you face times of the year you do not fly. The only reason I stopped doing biz with them is because of rudeness over the phone.
If you guy's have more info on this issue, Please inform.
I spend close to $1000.00 a month on all of my policy's and would like to learn MORE.

dipstick wrote:I am with aig. I just canceled my policy on my maule because it has been in annual for two months and probably will remain for another 2 months.

Canceling your policy was not the best way to go. Your agent should have advised you of the consequences of early termination as well as the various other options that are available. If an aircraft is down for "extended" maintenance you can ask the underwriter for a lay up credit. This is not available for normal maintenance downtime, but usually anything over 60 days is considered extended. With a layup credit the underwriter will pro-rate return up to around 75% of the premium for the days that your aircraft was out of service. This should be discussed and agreed to up front, but allows for full coverage while the aircraft is in maintenance and returns most of the premium once it is returned to service provided there was no loss.

By canceling your policy mid-term, you have put a bad taste in the underwriters mouth should you choose to place your coverage with them once the aircraft is back in service. You are also subject to a short-rate cancellation which includes early termination fees. If the underwriter does not agree to a lay-up credit, he may agree to a pro-rate cancellation in which you only pay for the days covered and there is not a termination fee.

Most all companies will also allow for ground not in motion coverage while the aircraft is not being used for long periods. This reduces the premium, but also does not provide any coverage while the aircraft is in motion. I would guess that this is what Avemco was doing for you.

-Low

One other thought on hull insurance...

If you total (complete wreck) your aircraft by having to land in an remote area in a protected forest, or a resevour (city water supply), etc., and you are carrying hull insurance, then the cost of that retrieval becomes the insurance company's expense. There have been cases when that cost has actually exceeded the value of the aircraft.

Some companies use a "constructive total loss" formula in which the cost of the damage and the cost of the retrieving the aircraft are added together to determine if "totalling" the aircraft is financially prudent instead of moving the aircraft and repairing it.

In the absence of hull insurance, you will have to pay to salvage the aircraft on your own in addition to absorbing the loss of the aircraft value.

All settlements assume that the policy is valid at the time of the loss.

RYAN

Good point, Ryan. Most agencies REQUIRE that you remove an aircraft from agency lands after an accident, and this can be substantial. And, you don't have to be landing off airport to get into this, either. An engine failure most anywhere in the west can turn into one of these.

MTV