In Canada we paid about $1.3k for liability only (no hull) on a $28k pa28, in a 10 member group. I believe this was a $1M liability policy and works out to about 4.6% of the hull value. The premium is probably raised because there is more than 4-5 members in the group.
I also paid about about $1.8k for a Aeronca Champ on floats, 37k, with 3 owners for a liability ($1M?) and hull policy. This works out to 4.8% of hull value. The premium is probably high due to low float time, and the obvious risks of losing an aircraft in the water :-).
In the UK we pay £2.3k for an agreed hull value of £75k, and £7.5M Liability, in a 6 owner group. This works out to about 3.1% of hull value.
It seems like the insurers in the UK have better rates :-). Especially when looking at the above, i.e. Peter and Emir.
Also, I have heard that in a mature market, insurers typically pay in the order of 100 to 105% of the premium collected to claims, but make their money back due to income generated from having your premium in advance. I understand that that the market is cyclical, and that should the insurers have a ‘lucky’ streak and only have to pay out 80% of the premium collected for a period, then their competitors start to undercut them to gain market share. I gather that this means over the years, the insurers cycle back and forth between a min and max percentage of premium paid out. Thus if your premium is high, it may be worth asking for a reduction and see what happens.
I pay 1% of the insured value as annual premium. That is pretty standard. The concept of “agreed value” does not exist in Germany, you cannot over-insure an aircraft so usually a value based on the blue book is used, adjusted by aircraft specifics (e.g. avionics).
Well, I agreed with my insurance that the airplane’s worth is 225.000, but they would have insured it for € 250.000 too. And it’s a german insurance.
I checked:
Third party / CSL Insurance: € 1400
Hull Insurance: € 2244,00
plus 19% VAT
Well, I agreed with my insurance that the airplane’s worth is 225.000, but they would have insured it for € 250.000 too.
That is because the insurer assesses the market value of the aircraft between 225-250k. In Germany, you cannot get insurance for an arbitrary amount. In France (and UK?) you can do that at any value, even if several times higher than market value.
I have insured several boats in France because of that — I don’t have to care if the insured value relates to the market value, whatever that might be.
I find 1% to be rather cheap. With the complexity of the aircraft (retractable), its age and the experience I have, one total loss every 80 years or so (interests considered) seems low to me. This is why I have hull insurance, not because I need the money. If I lose my aircraft (without losing my life at the same time), then I would be without aircraft which is an acceptable scenario. In general there are two reasons to obtain insurance:
1. The scenario you want to protect yourself against would be devastating (e.g. house on fire, most people would not be able to recover financially from that)
2. You believe there is an attractive ratio between risk and premium
even if several times higher than market value
Not quite, otherwise everybody would be insuring a C150 for €100k and setting fire to it. Or insuring an SR22 for 2M and pulling the chute above a nice calm lake on a summer day.
There is a negative to the Agreed Value system: the insurer has a massive incentive to repair the wreckage, rather than write it off as they normally would if the damage reaches ~50% of the MV. So you could be without a plane for 6-12 months (especially if the insurer is a crook, which some are) while they are waiting for some rare composite parts or whatever.
Not quite, otherwise everybody would be insuring a C150 for €100k and setting fire to it. Or insuring an SR22 for 2M and pulling the chute above a nice calm lake on a summer day.
Damn, and I thought that was my idea ;-)
Not quite, otherwise everybody would be insuring a C150 for €100k and setting fire to it. Or insuring an SR22 for 2M and pulling the chute above a nice calm lake on a summer day.
Obviously such things happen but insurance companies are not stupid. If they think something is fishy, they put a lot of effort/money into an investigation and apart from denying a claim, insurance fraud is a criminal offense.
The question also is why you over-insure. In our case with the boats, we do it because not having a boat basically means the company’s revenue goes down, it loses its reputation, distribution channel etc. which takes a lot of money to rebuild once you get a new boat. That’s why twice the market value is a reasonable insured value.
For a private recreational aircraft, there is less justification for over-insurance so an insurer would apply a lot of scrutiny on claims.
PS: even worse is under-insuring. Don’t use less than what the insurance company/broker recommends based on the blue book. In case of a repair, they would only partially pay if they believe the aircraft was insured at a too low value.
Obviously such things happen but insurance companies are not stupid. If they think something is fishy, they put a lot of effort/money into an investigation and apart from denying a claim, insurance fraud is a criminal offense.
You would just say you got behind the aircraft
Virtually everything that happens in flight will be paid out on, if the paperwork is straight.
The question also is why you over-insure
That’s a good Q and I don’t think many have considered this. I insure for 195k in spite of a ~150k MV, because I would want to replace the plane ASAP and any seller (who, let’s face it, will prob99 know me or know of me) is going to bend me over a barrel and… The extra 45k will be needed for the Vaseline purchase of another aircraft at an inflated price (have you seen the TB20GTs for sale for ~200k?) and then
which will certainly make it 200k.
If you need any asistance just let me know
Dear Emir. dear all,
I’m planning to fly in 2 weeks to the Balkans (still some fears to fight in the club mainly because no Continental Diesel support in this area) .
I checked easyVFR (and 2013 Jeppesen Paperchart) and found no special issues to fly in Bosnia, nor from a Croatia airport to LQSA. The plan is to fly LSMF LJPZ LDDU LQSA LYBE LOWG LSMF. Quite big plans for 4.5 day tour. might be shorten.
Any advise are appreciated.
Regards
Lucas
