lowflyin'G3 wrote:As an aircraft operator I have a unique situation in that I have been friends with my insurance agent since I was 19. His mother and now himself have insured every aircraft I have owned and on a personal level he has always told me how it was going to be with whatever I was trying to get accomplished with insurance. Most of what I have always seen lowflybye post parallels much of what my friend/agent says.

It is not always what I want to hear but it is what is really happening.

Frank is a great guy and we have been friends for years as well...Ms Dorothy aint so bad herself...LOL

Taming The Texan

Local aging pilot with 2000 hrs in his V tail and many military hrs before that and no accidents, very clean record. He turned 70 somthing and his insurance went way too high in his opinion. He reinsured and left out the hull coverage. A month or two later he did a gear up landing. Guess the bean counters knew what they were doing after all.

Tim

To respond to the question from the original post on this thread, and it's title, without getting into longwinded discussions of why insurance costs what is costs - which isn't much, really, compared to automobile insurance, the storm in Lakeland should be put into some perspective.

News reports and posts on the AOPA website indicate something like 60 aircraft at Sun'n Fun suffered "damage" ... which can range from a total to a ding in the wing.

That doesn't even come close to the number of damaged aircraft that result from even a puny Cat 1 or 2 hurricane that hits multiple times a years at anywhere from Texas to Maine, with Florida and the other Gulf Coast states, along with maybe Georgia and the Carolinas, getting the brunt of that damage. Back in 2004-2005 we had a slew of Cat 3, 4, & 5 storms hit Florida causing gazillions of (OK - I overstate ... call that "many") times the damage seen in Lakeland this week to everything in the storm's path - including aircraft in and outside of hangars - and I don't recall hearing that there was any major change in aviation underwriting prices as a result. Maybe there was, but if so it must have been short lived, cause insurance is cheap now, at least for typical certificated GA single engine aircraft that most us fly in the Lower 48. Property damage insurance in Florida certainly skyrocketed afterward, though!

Most single engine GA aircraft are cheap to insure, especially with fixed gear. Yes, multi-engines, retractables, and Alaska airplanes are more expensive to insure, and experimental aircraft are also expensive - but that's a reflection of actual loss history and risk factors as calculated by the underwriters. In Alaska, the flying conditions are tough, and there's a helluva lot of places where pilots fly where you pretty much have to total the aircraft unless you can fix it yourself and fly it out. And we've known for many years that experimental aircraft have much higher accident rates than certificated aircraft, for several reasons we don't need to get into here.

Bottom line - I can't imagine that totaling a handful of aircraft - even at a high-visibility airshow like Sun'n Fun - is going to have a large impact on the bazillions of dollars of insured value for hundreds of thousands of GA aircraft in the USA.

Lowflybye - correct me if I'm wrong (I'm sure you will).

And we've known for many years that experimental aircraft have much higher accident rates than certificated aircraft, for several reasons we don't need to get into here.

Really??? The numbers I've seen shown a higher rate for about he first 100 hours or so. After that, Experimentals are pretty comparable to the rest of the GA fleet. My insurance rate (for a tailwheel experimental) is also in-line with rates for similar type certificated planes.

This isn't the place to discuss this, but I felt the need to speak up as I beleive the facts are mis-stated. The recent Nall report lumped in LSA's, trikes, PP's, etc and skewed the numbers. For comparable aircraft, there is not much difference beyond the 100 mark.

blackrock,
Your research on experimental insurance cost came up the same as mine. I have an experimental four place taildraggin 2500 gross Tundra. Nearly 90% off airport use including hangaring on the farm. Leaving out the first test flight hours of 40 hrs, rates are similar to other aircraft of the same value and coverage regardless of certified or not. Had more to do with passenger seats, hull value and my own experience as a pilot. Here is the post on the Nall report numbers concerning playing with numbers of homebuilt aircraft fatalities, article from EAA.
viewtopic.php?f=1&t=6504&p=93207&hilit=2010+nall+report#p93207

Thanks dirtstrip. I was only pulling from memory and that gets tricky sometimes . 40 is likely the more real number as you state. So our rates should be comprable since we are both 4 seats and TW.

blackrock wrote:

And we've known for many years that experimental aircraft have much higher accident rates than certificated aircraft, for several reasons we don't need to get into here.

Really??? The numbers I've seen shown a higher rate for about he first 100 hours or so. After that, Experimentals are pretty comparable to the rest of the GA fleet. My insurance rate (for a tailwheel experimental) is also in-line with rates for similar type certificated planes.

This isn't the place to discuss this, but I felt the need to speak up as I beleive the facts are mis-stated. The recent Nall report lumped in LSA's, trikes, PP's, etc and skewed the numbers. For comparable aircraft, there is not much difference beyond the 100 mark.

Not a mis-statement at all.

http://www.generalaviationnews.com/2011/03/21/faa-launches-ga-safety-improvement-plan/ The Transportation Sec says homebuilts account for 5% of GA flight hours but result in 22% of GA accidents. Call him a liar if you will, but that's the bottom line stat that's out there.

The famous quote from the late Sen. Daniel Patrick Moynihan goes, "Everybody is entitled to their own opinion, but not to their own facts."

Now if you want argue with the FAA database, and to get into parsing stats, and creating all sorts of limiting exclusions and sub-categories, like," let's only talk about experimental aircraft accidents that happen after the first 100 hours", then you've just entered the world of, "there's lies, damn lies, and then there's statistics!"

(NOTE: I'm NOT calling anyone a liar ... it's just a saying, courtesy of Mark Twain!)

Talk to Lowflybye about loss rates and what it costs to insure the same pilot for a certificated single engine GA aircraft (your typical Cessna, Piper, Cirrus, whatever) vs. what the premium would be for an experimental aircraft of equivalent performance, weight, and complexity. Never mind establishing equivalent hull values of certificated vs. experimental airframes.

Not getting into a long winded argument on accident stats on this thread, which is supposed to be about the effects of the Sun'n Fun storm this week on aviation insurance premiums. But you wrote that I "mis-stated", and I did not mis-state anything.

nmflyguy,

Do you own an experimental? I do. I've owned type certificated planes, too and I can tell you the insurance premium rate for my experimental TW 4-place is consistent with TC rates; at least for both dirtstrip & I. Yes, numbers can be biased anyway one wants. The numbers in the article you linked to could be biased, too. Re-read my comment about the Nall report. I also said for like aircraft.

But you wrote that I "mis-stated", and I did not mis-state anything.

I said, "I beleive you mis-stated", That is an opinion. I'm often wrong and when I am, I own up to it. From the research I've done I just don't see it and I'm basing this on multiple sources including the EAA and AOPA. Nuff said. If you wish to continue this discussion let's take it to another thread.

Just wait till the government gets done putting its hands in insurance if you think the bank problems were bad. By the way, who do you think pays for the defaulted loans? The insurance companies of course...

Who do you think covered the risk of the junk mortgages and other junk status investments? The insurance Caompanies of course.

AIG insured so much of the crap investments that it had to be bailed out (with your hard earned tax dollars) to prevent a total economic collapse.

obxbushpilot wrote:
AIG insured so much of the crap investments that it had to be bailed out (with your hard earned tax dollars) to prevent a total economic collapse.

This cannot be prooved. Some economists say so and some say not so. Maybe they got bailed cus they donate big time. The small banks are failing cus they are too small to save and don't pay to play. Maybe we are just putting off the collapse for our grand kids.

Tim

Stol wrote:
In the Dulles fiasco. There were four damaged biz jets. 32 mil, 27 mil, 37 mil, 41 mil. That's a 103 million dollar claim. If the insurance company would have conceded the same day the hangar collapsed that all the aircraft were totaled and paid full price for replacement the next day, and written checks for that, plus loss of use for a few weeks till they could be replaced. The total cost would still be in the 125 million range, + or - a few million. Complete exposure for the insurance companies would be 130 mil MAX....I guess my question is ,,,,, How do you come up with a 400 + million dollar insurance company exposure ?

OK, I am back in the office and as promised...

Which company should have conceded the same day and paid the total losses plus a few weeks for replacement? The one that insured the FBO leasing the hangar space and responsible for the safety of the aircraft? The one who insured the architects and builders of the hangar who’s design and manufacture came into question? Or should it have been each company that insured the individual aircraft? It’s not as cut and dry as you would like it to be…although it would be nice if it were.

The $400 Mil insurance exposure comes from the estimated reserve limit set aside by the insurance companies to pay this claim. When a claim comes in, the adjustors try to determine what the total cost of the loss(es) could be and place a reserve amount on it. This reserve is (hopefully) a worse case figure, but they also try to make them as accurate as possible. Funds are then set aside for this claim and become "designated" meaning it is not to be used for budgeting, investing, etc. so that if the loss does hit the reserve the money is there to pay it. Many times the actual payout for a claim will end up lower than the reserve (this is good), but sometimes it comes in well more than the reserve as in the Corey Lidle case which is still ongoing.

The reason that there is more than the $103 Million that you referenced is that there was more than just the aircraft you listed that were damaged and that’s because there was more than one hangar that collapsed.



The Hangar Keepers Liability policy (for the FBO) had a $300 Million limit on it. The aircraft that were in the collapsed hangars and had claims filed on them (as was shared with me by various underwriters) were as follows:

(4) Global Express
(1) G-V
(1) G-IV
(2) Hawker 800
(1) Falcon 2000
(1) Falcon 900
(1) Beechjet
(1) Leer 45
(1) GA-50
(1) Cessna Caravan

Now, take the information that I gave you earlier about ancillary coverages…not all of these aircraft were total loss so the extra expense comes into play as well as loss of business use while they recover the aircraft & repair the damage. Combine these coverages with the fact that these aircraft were owned by: Hilton, MicroStrategy, Kodak, Arcadia, FedEx, Corporate Air, BAE and other big companies who use the aircraft routinely and you can see how quickly the expenses will add up to more than just the cost of the damage to the aircraft.

The policy coverage for the hangar buildings themselves will also come into play and that is estimated at $50 Million, although comparatively it will be much less to repair than the aircraft.

Why not just bulldoze the hangars down and payout the total claims? Because the companies would lose all chance of salvage value from recovery if they did so and that does not benefit anyone. It is beneficial for all of us when they can recover some of their loss with the sale of salvage. Just because the airframe on a G-V is totaled does not mean that the engines, avionics, gear, etc is not still usable and worth a good bit of money. It may cost more in the short run to take their time with recovering the aircraft, but in the long run they may come out far better. This is one of the reason why the actual cost of a loss can take quite a while to determine.

For more information and an interview with the owner of Dulles Jet Center: http://www.ainonline.com/news/single-ne ... ild-24080/

Looks like the salvage business is one of the big reasons losses to insurers from totaled out aircraft and hangars does not come back dollar for dollar to those paying premiums. Thanks for your courtesy/patience in answering questions that are usually not.

Thanks lowflybye for the explaination...
I went to the link but it was not very informative...

Did they use cranes to dissassemble the structure slowly and remove the planes with minimal additional damage? That whole process would make a great time lapse video... .

Ben.

Here it is:

Date: 31-MAR-2011
Time:
Type: several aircraft
Operator: private
Registration:
C/n / msn:
Fatalities: Fatalities: 0 / Occupants: 0
Other fatalities: 0
Airplane damage:
Location: Lakeland-Linder Airport (KLAL), Florida - United States of America
Phase: Standing
Nature: Demo/Airshow/Display
Departure airport: KLAL
Destination airport: KLAL
Narrative:
KLAL - Lakeland Linder Regional 2011 Sun n' Fun fly-in and exposition in Central Florida has been hit by a Tornado - airplanes are everywhere!! Should be a list of damaged and destroyed airplanes eventually.
15 persons injured - 8 treated on scene, 7 transported to hospital - non life threatening.
Reportedly the tornado just missed a line of warbirds and tore thru the homebuilt section tossing aircraft end over end.

Partial list - possibly another 25 or so aircraft;

N106ZX Microleve - Corsario - cn 453 substantial
N11ZV Maule- MX-7-180B - cn 22030C substantial
N12XR Henry Spencer - RV-3B cn 11395 repairable
N171CC Cessna 208B Grand Caravan 'Sure Thing' - cn 208B2000 - substantial
N2300S Super 18 - S18 - cn 1 - substantial
N2397C Piper PA-28-181 Archer LX - cn 2843696 - minor - repairable
N289R Robert Barrows - Bear Hawk - 195602 - substantial
N426AM Marrero Edgardo - Acey Deucy P-70 - cn 0521 - substantial
N43WY Aviat A-1C-180 Husky - cn 3113 - substantial
N523J McBride - Rans S-7S Courier - cn 0906446 - substantial
N54BY American Champion 7GCBC - cn 1404-2005 - substantial
N55PK Piper PA-32-301 Saratoga - cn 32-8206029 substantial
N60JA Helio - H-295 - cn 1240 - substantial
N60491 Kitfox was due to make first flight as show - written off
N612WF Cat Island - AirCam - cn AC148 - written off
N6595Q Alon A-2 Air Coupe - cn A-95 - substantial
N66WY Aviat Husky - A-1C-200 - cn 3116 - repairable
N67504 Cessna 172P - cn 17275824 - repairable
N7ZV Maule MX-7-180A Sportplane - cn 20018C - substantial
N71ZA Burl Nelson - Zenith 701 - cn 7-7186 written off
N750ZZ Roger Dubbert - STOL CH750 - cn 7-6640 - substantial
N801PP Townsend - STOL CH801 - cn 8-7058 - repairable
NX840LM Pietenpol Air Camper (built by Lion G. Mason) - cn 001 - written off
N904KJ Klima - Vans RV-9 - cn 91201 - repairable
N912LA Tony Rasoh - AirCam - cn AC138 - substantial
N94GA Eclipse EA500 - cn 000072 - minor - repairable
N950TC Robert Meyer - AirCam - cn AC126 - written off
NX971BP Pietenpol Big Piet (built by Frank A. Metcalfe) - cn BP001 - repairable
NX974BP Pietenpol Big Piet (built by Bruce E Laird Jr.) - cn BP004 - substantial
XB-ALE Ultravia Pelican Sport 600 - upside down - repairable

Stol wrote:
Did they use cranes to dissassemble the structure slowly and remove the planes with minimal additional damage? That whole process would make a great time lapse video... .

Ben.

Yes, had to support the structure to prevent further collapse and damage while they disassembled it with cranes...not an easy task.

Here is a video from the deconstruction /recovery company. It is a bit slow to load but your time lapse video is the second half... http://www.cseonline.net/dullesvideo/index.html

And some pics for you as well

blackrock wrote:Thanks dirtstrip. I was only pulling from memory and that gets tricky sometimes . 40 is likely the more real number as you state. So our rates should be comprable since we are both 4 seats and TW.

Hey, Blackrock you are smarter than I gave you credit for. I just got the renewal quote on my Experimental Tundra and the rate dropped by 7% AND there are no longer any deductibles. The new policy quote is from the same insurer for the same coverage. I emailed the agent back because I am always curious why something gets cheaper. I suspected it was the mountain flying training entered in my log by an instructor last year. Well guess what, the agent said while that doesn't hurt, she thought it was more due to having crossed the 100 hour mark. Per thousand insured my experimental is now cheaper than some certified planes I know of.

dirtstrip wrote: I just got the renewal quote on my Experimental Tundra and the rate dropped by 7% AND there are no longer any deductibles. .

FYI- If you are an EAA member and you are insured thought Global Aerospace, be sure to tell your agent and provide them with your membership number. Global Aerospace will waive the deductibles and increase the Medical payments to $10,000 for EAA members. Starr Aviation writes experimentals and has NIL deductibles on all policies but until recently these were the only 2 companies writing experimentals with NIL deductibles. USAIG just re-entered the experimental market but will only write what they consider "cream of the crop" risks. This adds a 3rd company with NIL deductibles for experimentals on a routine basis. USAIG and Starr have the most broad policies out there meaning they give you the most coverage for your dollar and the most liberal exclusions.

Thanks for that. I am an EAA and AOPA member and I receive a discount about equal the cost of the membership for those. My company is Chartis, which I believe is the former USAIG. If that is so, you people may address me as... MISTER Cream of the Crop.

dirtstrip wrote:Thanks for that. I am an EAA and AOPA member and I receive a discount about equal the cost of the membership for those. My company is Chartis, which I believe is the former USAIG. If that is so, you people may address me as... MISTER Cream of the Crop.

Chartis was formerly known as AIG...they changed their name for obvious reasons. USAIG and AIG are not related in any way...like Ford & Chevy. Sorry Mr. Cream of the Crap.

With regards to EAA & AOPA memberships. Charits gives AOPA discounts, but does nothing for EAA membership. This is because Chatis is a big sponsor of AOPA. Conversly, Global Aerospace is a big sponsor of EAA and does nothing for AOPA memberships. Chartis will give a 5% discount on the hull premium for AOPA members. Global does not give a premium discount for EAA members, but removes the deductibles and increases the Med payments.

Because of these sponsorship relationships, using AOPA as an agent normally means that you will only get a quote from Chartis (for obvious reasons) and sometimes the other companies if Chartis is not competitive, but very rarely (if ever) will they get a quote from Global. Don't want to slap a major sponsor in the face.

Along the same lines, Falcon Insurance is a big sponsor of EAA (just look in Sport Pilot / Sport Aviation magazine) so they tend to lean towards Global Aerospace for their quotes on EAA members and shy away from Chartis.

Just follow the money trail.

None of this is of real concern for us, the end user...just some more information on how the market plays out. Just for kicks and giggles, if you are insured though AOPA ask them what Global quoted next time your renewal comes up...after they give you the quote options.

I used an independent agency and they came back with four different quotes from four different companies.

So, the AOPA is the only membership discount that affected me, the rest is just a lower quote from Chartis, who is not formerly USAIG but just AIG. To them then, I am not considered Cream of the Crop but they like to insure me because as we all know they are not averse to taking a huge risk. What is your take on the premium drap. ( Forgive my spelling, but yours is no better.)

I think I would enjoy sharing a beer with you.