I spent many years of my life trying to explain aviation insurance to aviators and aviation businesses. Much of it fell on deaf ears. But the National Business Aviation Association is helping with that.
I recently participated in a webinar provided by NBAA. The title, “Understanding Your Insurance Policy” caught my attention immediately. The webinar was moderated by David Weil, Solairus Aviation, LLC. Presenters were two professionals in the insurance business: Stuart Hope, Hope Aviation Insurance, and Brint Smith, John F. Throne & Company.
Most people can tell you a blue-jillion jokes about insurance (Insurance is where you bet your aircraft will crash, the insurance carrier bets you won’t, and you both hope the carrier wins. Some aircraft fires are caused by the friction between all those liens on aircraft rubbing up against all those insurance policies during tough times.), but they do not understand their policy.
Unfortunately, many people really don’t understand what their policy does and doesn’t cover, and therein lies the reason for many problems between those who provide aviation insurance and those who buy it.
To paraphrase Richard Nixon, let me make one thing perfectly clear: In years of selling and servicing aviation insurance I never, ever, saw a carrier try to cheat a customer — not once. What I did see were people who didn’t understand their policy and didn’t seem to care until there was a loss.
Now hear this: The most important thing you need to understand about your policy is what questions to ask your representative before the loss occurs. That was a major part (maybe the most important part) of the NBAA webinar.
What’s the difference between the named insured and an additional insured? What’s the downside of adding another additional insured? If your company is going to fly someone else’s airplane and that company shows you that your pilot meets the requirements listed in its policy, does that mean your company is covered if your pilot crashes the airplane?
Did you know you might eliminate coverage by agreeing to accept the liability in certain contracts? Do you ask your insurance rep about the risks of new contracts before you enter into those contracts? Should you? Many insureds seem to think that if they don’t tell the representative or the carrier, everything will be all right.
Should you insure your airplane for more than it’s worth (hoping to come out ahead on a loss), or less than it’s worth (to save a few bucks on premium)? All these questions were covered during the webinar.
Could this webinar make you an insurance expert? No way. Would it help you make intelligent decisions about when to contact your insurance rep? Yes indeed. It costs nothing to get an answer from your rep before an accident. It could cost you a fortune to get the rep’s answer afterwards.
