We provide insurance for owners and operators of aircrafts, both for private and public use. Coverage varies between policies and can include insurance for damages, malfunction, spare parts, lease on a replacement aircraft, liabilities, and even war.
This primer serves as a guide for Aviation Insurance. It outlines the types of coverages for "General Aviation" risks available in the Aviation Insurance Market. Risks of this nature pertain to aircrafts that have a seating capacity of up to 50 seats.
AVIATION HULL RISK INSURANCE
This type of coverage protects aircraft operators against physical loss/damage to aircrafts that are being operated under their control at the time of loss. The insurance policy will cover the aircraft for the agreed value stipulated in the policy. Unless the loss is adjusted as a "Total Loss," there will be a self-insured deductible applicable to any subsequent hull claims.
AVIATION SPARES ALL RISK INSURANCE
This coverage is identical to that of the Hull All Risks Insurance for spare parts either carried on the aircraft or stored separately for use with the insured aircraft. The Insurer requires an inventory of spares before agreeing to the spares "Average Value at risk," defined as the pre-set value that the Insurer agrees to pay in the event of a loss to a spare item. The Insurer will look closely at the possible accumulation of spares at any one location as this can represent a significant exposure to certain perils such as fire and flooding.
AIRCRAFT UNAVAILABILITY INSURANCE
This insurance will cover the lease cost of a replacement aircraft in the event that the insured aircraft suffers damage or is unable to fly for technical reasons. The policy will have a "waiting period" of 7 days, for example, before the daily indemnity can be applied to the claim.
AVIATION LEGAL LIABILITY INSURANCE
In the event of an aircraft accident causing bodily injury to passengers on board the aircraft, aircraft owners and/or operators have a legal liability towards any temporary/permanent bodily injury suffered by the passengers. Aircraft owners and/or operators also have liability towards compensation awards to relatives of deceased passengers and third parties arising from the accident. Normally, the level of compensation is awarded by a court of law in the country where the passenger is domiciled.
AVIATION HULL WAR INSURANCE
Under the Hull All Risks policy mentioned earlier, there is a specific exclusion clause for certain perils commonly referred to as war perils. These include acts of foreign invasion, hijacking, civil commotion and the detonation of atomic bombs. For a premium consideration, aircraft owners and/or operators can purchase Hull War Insurance to cover some of the risks excluded under the Hull All Risks policy.
HULL DEDUCTIBLE INSURANCE
Mentioned earlier in the Hull All Risks section was reference to "self-insured" hull deductible. This exposure can be reduced by purchasing a coverage known as Hull Deductible Insurance, which will reduce the amount of self-retention by the insured down to a minimum level.