Ad Blocker Detected
Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.
After a number of years with relatively modest rates for aircraft insurance — at least for the more easily insured aircraft and operations — rates have increased, even for experienced pilots with good records.
What’s behind these rate increases?
To learn more, we reached out to one of the most Light-Sport Aircraft, Sport Pilot kit aircraft-friendly insurance agencies, AIR, a fun abbreviation for Aviation Insurance Resources.
Thanks to rapid increases in technology over the last decade, insurance has become ever-more competitive.
“Ten years ago a quote for a Cessna 172 may have taken a day or two to receive all available quotes back,” said Victoria Neuville, an AIR agent, Commercial Pilot, and CFI. “Today most carriers can provide their quote within minutes.”
“With quoting becoming almost automated for many aircraft, insurance underwriters found themselves having to find new ways to stay competitive,” she added. “This meant broader policies, more flexible training requirements and, of course, a lower rate.”
These changes led insurance companies to what is called a “soft market.” Pilots and aviation business owners often benefited from flexible underwriting and record low premiums.
“Aviation underwriters were all competing for the same group of business and the way to win the account was to provide the lowest rate,” noted Gregg Ellsworth, a regional rep for Aviation Insurance Resources who specializes in Light-Sport Aircraft. “With these lower rates, however, the aviation industry didn’t experience any fewer losses, especially with the countless natural disasters experienced recently.”
As with any business, Gregg explained, “rates had to increase in accordance with the outgoing costs.”
Additionally, Victoria indicated major changes are normally seen every two to five years in the insurance market.
“After enjoying low rates for nearly 10 years, the aircraft insurance market is once again hardening due to poor loss ratios,” she observed. “Stricter training requirements are being implemented to increase aviation safety.”
“To mitigate the aviation insurance risk, many underwriters are now requiring stricter initial training if a pilot is new to the aircraft from an instructor experienced in that specific make and model,” Gregg added.
“Senior pilots have been greatly impacted in this hardening market, specifically those in retractable gear and multi-engine aircraft,” Victoria noted. “If a single engine piston fixed tricycle-gear aircraft can fit your aircraft needs, this will often result in a better rate and insurability on your aircraft insurance.”
Her advice seems nearly written to boost the
This post was originally published by General Aviation News on . Please visit the original post to read the complete article.