States That Require Aircraft Insurance - Self-insuring simply means that you cover any potential loss yourself rather than paying premiums to an insurer to cover any loss. Regarding optional coverages, each aircraft owner must weigh their own risk. Some aircraft owners have the financial means to repair or replace their damaged aircraft.
Others are willing to gamble that they won't ever need to cover such costs. Or, if they do, they understand that the loss could mean the loss of their aircraft all together. Evaluating a policy will be easier and less stressful if you have at least a broad, general understanding of the terms it contains and the acronyms that aviation insurance professionals use to describe them.
States That Require Aircraft Insurance
Read on for a description of some of the key concepts. Republican Rep. Cheryl Acton said the number was chosen so as not to be "overly burdensome" on recreational pilots, according to the newspaper account. The bill was triggered by a 2020 accident in Acton's constituency of West Jordan that destroyed a house.
Self Insuring
In 2017, a pilot on a pre-purchase flight had to put down on a road after engine trouble. The aircraft hit a car and because there was no liability insurance the car owner's only recourse was the courts.
She's suing the pilot and the company that maintained the aircraft. Almost every aircraft owner should carry at the very least a liability only insurance policy. But what about other types of aircraft coverage? How do you determine which are worth buying and which are worth the risk of self-insuring?
When deciding how much and what types of aircraft insurance coverage you should carry, you need to consult a knowledgeable and trusted broker. They can thoroughly explain the different types of coverage and then help you determine which coverage you must carry, the coverage you should consider and the coverage you can do without.
Understand the insurer's claims philosophy Insurers approach claims somewhat differently. It's understandable to hope you never have to make a claim, but you want to be sure the company you choose has a history of resolving issues fairly and quickly.
Should I Insure My Aircraft?
Keep these aircraft insurance pointers in mind as you prepare to buy an aviation insurance policy for your fixed- or rotary-wing aircraft. Not only will this make you a better-equipped buyer, it will help you avoid purchasing a policy that doesn't meet your needs.
Have a rough idea of what your insurance will cost Before you begin the purchase process, having some sense of what you will likely be paying can be helpful. Talking with friends in the aviation community who are comfortable sharing information on their aircraft policies can give you a rough idea of costs.
PR/SR — Pro rata and short rate. These terms relate to how the return premium is calculated if the policy is canceled. If the insurer cancels then the return premium is pro rata but if the insured cancels then the premium return is calculated on a short rate basis.
You've completed your pre-flight check and are getting ready to take off. But have you thought of everything? Whether your aircraft is brand new or you've owned it for many years, have you verified that you would be fully covered in the event of a loss?
Key Considerations When Purchasing An Aviation Insurance Policy
BOW — Breach of warranty. This provision ensures that a financial institution that has a financial interest in an aircraft gets paid if the aircraft is damaged, even if the policyholder does not. Most lenders require this.
Uninsured motorists surely do more damage to homes alone each year than light aircraft, never mind injury and other property damage. Off road vehicles are likely to cause more damage as well. So you already know the limitations of such policies and are aware of a bigger problem.
Seems to me this was going for low hanging fruit that was easy to do rather than spending time on hard work that really needs addressing. Utah has made a minimum of $100,000 in liability insurance mandatory for owners of general aviation aircraft after some crashes involving uninsured planes.
The bill was passed as an amendment to existing legislation and requires minimum coverage of up to $50,000 for bodily injury per accident, up to $50,000 for property damage and no more than $100,000 total for both types of damage.
Ready For Takeoff? Having Sufficient Insured Value Is Critical
Utah is the 12th state to mandate liability insurance for GA aircraft. The only criticism of the measure so far is that $100,000 is a drop in the bucket to cover the damages that can result from airplane crashes.
"It was done for the right reasons with good intentions, but it's a little short on money," Bryant Garrett, the manager of Ogden-Hinckley Airport, told the Standard-Examiner, reprinted by the Salt Lake Tribune. Richard Phillips – on a single piston?
1,000,000.00 of liability is not even offered at any price on my aircraft. It is not about ratings or hours as I have those. The insurance industry just chooses not to offer that level of indemnity so I have no choice in the matter.
If it was offered and was somewhat affordable I would have it. a plane in a hangar or tied on the ramp catches fire (oil/fuel leak, space heater left on, etc.) and the ensuing fire burns the t-hangar and the planes within them, or the planes around them on the ramp.
State Requirements
Some states require aircraft owners to carry liability insurance as a minimum, but unlike auto insurance, most states do not require that you carry a comprehensive aircraft insurance policy or set minimum liability insurance requirements for aircraft owners.
Here in FL, one airport I had a T-hangar at wants liability insurance. Another, didn't. When I inquired of the airport that didn't they replied that IF they did that, they would become complicity — legally — for users of their airport who didn't have it and needed it.
They said that without a requirement, it's between the parties involved in any issue and their lawyers. Makes good sense to me. Flying outside of the United States brings a different set of requirements and insurance considerations.
If flying to Mexico for example, you will need to obtain a Mexican Certificate of insurance, which is basically a translated copy of your US aircraft insurance policy. The more you know about how to buy aircraft insurance coverage or update your aviation insurance policy, the more complete and cost-effective your coverage will be.
International Requirements
If you have questions, please contact us at your convenience. While I personally think it's pretty irresponsible to fly without insurance, unless you're truly wealthy enough to self-insure at a respectable level, I know that some folks choose to do it.
My question, which I was expecting the article to answer, is to whom does this legislation apply? Pilots, or aircraft owners? Aircraft based at Utah airports? Every aircraft that flies in Utah airspace? Any plane that lands at or takes off from a Utah airport?
It seems like there are a zillion ways this law could be written, and it's kind of impossible to decide if it's sensible or not without knowing how it actually applies. If you rent or own an aircraft hangar, the airport will typically require a $1,000,000 premises liability insurance policy that covers (slip and fall) accidents within the hangar.
This coverage is usually included with owned-aircraft insurance policies and you do not need a separate insurance policy. TRIA—Terrorism Risk Insurance Act. A federal law that requires insurers to offer insurance for acts of terrorism, but provides that the insurance industry and the federal government share certain terrorism-related losses on specified terms and according to a specific formula.
Knowledge Is Power
Whether you are looking to purchase new aircraft insurance coverage or reviewing your existing policy, it's helpful to be familiar with the many aviation insurance acronyms used by insurance professionals. Some of the more common include:
Let's imagine that, unfortunately, you experienced a loss, incident or accident during which your insured aircraft sustained physical damage. Whether it results in a "total loss" or a "partial loss," it is commonplace that after the adjustment and settlement of the physical damage insurance claim, the aviation insurance provider's claim handler prepares to tender its payment of the physical damage loss to the
policyholder (the “named insured”) and any additional loss payee(s) endorsed under the aviation insurance policy, unless otherwise directed. Only you can assess the likelihood of something happening based on your individual circumstances. How and how often you use your aircraft should be part of the discussion with your aviation insurance professional, when deciding coverage needs.
Makes no sense at all. I've rented buildings that require liability insurance, it's quite common. And why would someone *not* have this insurance? They could crash on the highway, injure some people but walk away, and lose all of their assets.
Hangar Requirements
We never flew without a couple million, back in the day. We have a really big problem nowadays where we do more and more to control people who generally are not a problem while having very little government energy spent on rule breakers who actually are the issue.
With over 55 years of experience insuring aircraft, BWI Aviation Insurance can help you determine your insurance needs and make sure you are neither under nor over-insured. Call us at 800-666-4359 with any questions or to get a quote.
Our knowledgeable representatives are ready to assist you. While a meaningful mandatory liability insurance for planes seems to make good sense, it is strange to require it state-wise, which makes it very difficult for owners and pilots to track requirements.
Is it NOTAMEed or do you need to study individual states' publications? As aircraft registrations are handled nationally, there should be a federal standard. $100,000 won't cover a damaged house, let alone anyone killed in an accident, and experience with cars has shown that increased coverage doesn't make much difference to the rates.
Aviation Insurance Acronyms
Over our 42-year history, BWI has built longstanding relationships with all of the above Aviation Insurance Companies. We work hand in hand with the above companies and leverage our experience to find the best market for your particular airplane insurance risk.
This "article" is merely a synopsis of the linked newspaper story. If you're going to mention that 12 states require insurance, please name them. As another commenter suggested, please research and inform on the ramifications of this law and how it may affect transient pilots.
Financing an aircraft purchase is no different than getting an auto loan or mortgage. The lender will have specific insurance requirements, typically liability and physical damage insurance coverage, that you must carry during the duration of your loan.
72-10-111.5. Aircraft public liability insurance requirements — Proof of public liability insurance. (1) Subject to Subsection (2), an aircraft owner shall: (a) maintain public liability insurance coverage for the aircraft that conforms to the requirements described in Section 31A-22-1300;
Aviation Loss Payments Clear Title Clear Skies
and (b) provide a certificate of insurance issued by an insurer as proof of the owner's valid public liability insurance covering the aircraft as part of any lease agreement with a term of six months or more between the aircraft owner and a public airport.
(2) Subsection (1) applies to an aircraft only if the aircraft is: (a) an operable fixed-wing aircraft; and (b) used for flight. Nothing can take the joy out of being a pilot or operator like having an incident with your aircraft, and then learning that it is not covered, or not sufficiently covered, by your aviation insurance.
To avoid that one-two punch, it's critical that you understand what you need and what you're getting when purchasing your aviation insurance policy. It's also important to refresh your memory periodically on the insurance provided by a policy you haven't looked at in many months or years.
Understand liability insurance and whether you are required to have it in your area Even if you are not legally required to have liability insurance, you may want to consider getting it. The legal liability you could face if your aircraft is involved in an incident causing an injury, death, or significant property damage can be substantial.
Why Choose Bwi Aviation Insurance?
If you have liability coverage, the insurer will also pay for your legal defense if you are sued for these losses.
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