Properly Insuring your Aviation Business
If you operate a flight school, airport, charter flight business or you’re an FBO, you require aviation insurance. Aviation insurance includes many options and your program should be specifically designed for your unique operation. Here’s a brief look at the various aviation insurance products available – let’s see if they fit your operation:
AGL (Aviation General Liability)
This is a basic form of General Liability insurance which protects your business from third-party claims of property damage and bodily injury. It needs to be an “AGL” product and not just a “GL” product because a standard “GL” carves out aviation-related claims. An AGL specifically fills in this gap. Typically, any business operating on airport property requires this coverage and it falls into three categories:
Premises Liability – This protects you against claims of bodily injury or property damage from third-parties. An example could be a slip-and-fall claim by a visitor to your premises.
Hangar keepers Liability – This coverage protects your business from claims due to damage to aircraft of others while it’s in your care, custody or control for storage or repair.
Products Liability – This protects you against claims arising from the product you produce which is used in conjunction with aircraft or airport operations.
This insurance product covers your passengers in the event of injury or death. Coverage is also typically extended to include property damage to passenger’s baggage or cargo.
Ground Risk Hull Coverage
This coverage protects your owned aircraft from physical loss or damage while on the ground. It can be purchased for either “not-in-motion” aircraft or “in-motion” aircraft or both.
Property coverage is not a mystery – it protects your property from an insured loss. This could be your office building and contents, as an example, and the loss could be due to a fire caused by an electrical short.
Other key protections include premises Pollution coverage to insure against spills from airport fuel tanks and Search and Rescue coverage which pays for costs associated with locating one of your aircraft in the event it goes missing.
The Right Broker is Key
Given the myriad of aviation related businesses in operation and the dozens of different insurance products available, the right insurance broker is key in ensuring you’re properly protected. Is your broker an Aviation Specialist? Most brokers do not live in the aviation space and have limited knowledge of how the different coverages respond. How well does your broker know your business? Does your broker check-in with you every 6 months and meet with you annually to present all of the insurance market responses? If not, perhaps it’s time for a change.