Some Considerations for Your Aviation Insurance
As we are all well aware, 2020 has provided plenty of situations that may make us think about how to handle operations that may have never crossed our minds before. The year started off with the adjustments we all made due to COVID-19, but that was followed by some destructive weather that caused quite a bit of loss to both aircraft operators and airports.
As we try to prepare for storm season while also working our way through the pandemic, it is a good time to review your aircraft insurance policy if you haven’t done so already. While some operators may look to make a change to their insurance policy, or allow it to cancel while the aircraft is grounded, there are a couple of things to consider.
In a lot of cases, a carrier may not allow for mid-term changes to policy due to the aircraft being grounded or not flown, so some operators will consider dropping their policy to save money. This is normally not a good decision, as it leaves the operator exposed to any losses that may occur while the policy is not in force. In addition, when the operator is ready to put policy back in force, their previous carrier may not be interested in taking them back, and the operator may not be able to get a policy with the same terms and premiums they had prior to the cancellation.
While reviewing your coverage, another important area of concern as we approach storm season is damage to an aircraft. An aircraft’s hull value is where an owner will recover from a loss in this type of situation. An owner will want to be sure they have accurate hull coverage to ensure a smooth claim process. Undervaluing an aircraft’s hull value can lead to an undervalued recovery. Overvaluing the hull will result in an overpriced policy the owner will not recover.
The next time you have a chance, take a look at your policy and call your broker with any questions so you know exactly what you are paying for, and there won’t be any surprises.