Depending on your state, it may be illegal to fly a plane without insurance. Even in states that don’t have laws pertaining to insurance, FBOs would require your plane to be insured to use their facilities.
Aircraft Insurance Requirements
Insurance requirements are the same across the United States. If you’re planning on flying internationally, however, you’ll need additional international liability coverage. The amount of insurance coverage you need depends on the size and type of plane that you have, as well as the equipment you have on board.
Proof of Insurance
Proof of your insurance must be carried on the plane. The proof of insurance should show that your insurance coverage meets all of the requirements for a plane of its size and category, the equipment it has, and the flight you’re planning on taking.
Hangar insurance is the insurance that covers the hangar in which planes are stored. Hangar owners must have hangar insurance. If you choose to rent a space in a hangar, you may need your own hangar insurance in order to cover any damage that could happen while it is in storage.
If you’re planning on flying internationally, you’ll need to make sure your aircraft’s insurance also includes international liability. While there is standard worldwide insurance that should cover your plane throughout most of the world, some countries may have specific requirements. Landing permits may be denied if you do not have the proper insurance for your destination.
Specifically, Italy, Mexico, Hong Kong, Germany, and the EU may have additional requirements. However, it is best to check that you have all of the required insurance before you leave no matter where you are flying.
If you don’t own your own plane, you may still need to have insurance coverage for planes that you or your company have used. Non-owned aircraft insurance covers individuals and companies that charter aircraft to protect them from any liability in the event of an accident. Non-owned aircraft insurance is also called aircraft rental insurance.
What Does Aviation Insurance Cover?
There are different types of aviation insurance that together cover the physical plane, any damage it could cause to property, aircraft crew, and any passengers.
In-flight insurance covers any damage to the plane that is the result of an accident or other events that occur while the plane is in motion, generally while it is in the air.
Public Liability Insurance
Public liability insurance is the type of insurance that is most often required by law for aircraft owners. This is the type of insurance that covers damages to external property or people. It doesn’t include coverage for passengers or damage to the plane itself.
Passenger Liability Insurance
Passenger liability insurance covers any harm that may come to passengers.
Combined Single Limit (CSI)
Combined single limit insurance is a combination of public liability and passenger liability insurance.
Aircraft Hull Insurance
Aircraft hull insurance covers any physical damage to the plane itself while it is on the ground. This can come in two different types – motion and non-motion. Non-motion coverage is for damage as a result of things like vandalism, an accident with an uninsured vehicle, or weather events. Motion hull insurance covers damage sustained during takeoff or landing.
Aircraft crew members are typically insured by the company that they work for. The pilot and cabin crew would have their own insurance through their company’s workers’ compensation and don’t need to be covered under your aircraft insurance.
How Much Does it Cost to Insure a Plane?
The cost of your insurance policy does vary depending on the category and size of plane you own and the coverage your policy provides. Insurance for small aircraft usually costs between $1,200 and $2,000 annually.
The amount of coverage depends on your policy. Having the bare minimum policy may not be good enough in the event of an accident. What the insurance company pays may not be enough to fully cover the repairs, leaving you with the balance. It’s important to calculate how much insurance you really need in the event of having to repair or replace your plane.
Rate Increases After Claims
Whether your insurance premium rises after a claim depends entirely on the cause of the claim. If damage was caused by something like a lightning strike, then the insurance company may be more understanding than if there was an accident or if you or your crew were at fault in any way.
How Can I Minimize Aircraft Insurance Costs?
The best way to keep your aircraft insurance costs to a minimum is by remaining claim-free. However, that’s not always possible, but there are other things you can do to try to keep costs down.
Use a Hangar
The likelihood of damage to your aircraft is less when you store it in a hangar. For the same reasons that it’s better to park a car in a garage than on the street, a hangar is preferable to a tie-down for aircraft upkeep. The plane is protected from variable temperatures, from the sun, and from wind, hail, and other weather.
In addition to lowering your insurance rates on your plane, storing your plane in a hangar also reduces the maintenance costs of the aircraft.
Pilot Proficiency Training
You may be able to lower your insurance rates through pilot training. The more training you have, the lower the risk of an accident. Annual training may be required to maintain coverage. In addition, insurance companies may have specific training programs that they require in order to lower their premiums. It’s important to check with your insurance company to determine their requirements before embarking on any training programs.
Increase Flight Hours
Insurance companies use the total number of hours as a factor in calculating the risk of insuring planes. Having more than 5,000 hours of flight time reduces the risk of a crash by up to 50%. The more flight hours you log, therefore, the lower your rates may be.
Obtaining an instrument rating can not only improve your piloting but can also reduce your insurance payments. The FAA has specific requirements for any pilot that wants to obtain an instrument rating. There are specialized schools available as well as many private instructors who are certified to train you for the instrument rating. Check with your insurance company first to see if they have any recommendations or requirements.
Join a Flying Club
Some clubs and associations may be able to obtain discounted rates for insurance. Most clubs charge a membership fee, which then gets you access to not just a discounted insurance rate, but also access to the club’s fleet of aircraft, as well as contact with other owners and pilots.
Who Needs Aircraft Insurance?
Any person involved with the flying or operation of an aircraft should have some kind of insurance. That insurance should cover any person who is on board that plane, including passengers.
Aircraft owners must have insurance. Their insurance is the most comprehensive of the available insurance options, needing to cover the plane in the hangar, on the ground, and in the air, as well as any passengers on board the plane.
Renters should have aircraft rental insurance to cover themselves and any liability that they may have for the operation or charter of the aircraft.
Part-owners need to, between all of the owners, have the same insurance as a full owner. The insurance rates may be different for a group of owners rather than one owner.
Any pilot flying a plane that they do not own should carry their own insurance. The aircraft owner’s insurance covers passengers and the plane itself, but not the pilot. Pilots should have the following:
- Medical Payments Coverage
- Aircraft Liability Insurance
- Aircraft Physical Damage Coverage
What Happens if My Plane Is Uninsured?
If your plane is uninsured, you may be barred from using FBOs. Every airport with facilities for general aviation is operated by at least one FBO, which generally requires insurance. Whether you want to fly domestically or internationally, without insurance you may be denied landing permits.
Where Do I Get My Plane Insured?
There are many insurance companies that insure aircraft. Avion Insurance, for example, offers comprehensive and affordable aircraft insurance to cover your plane whether it’s in the air or on the ground. It’s important to research ahead of time exactly what coverage you need and to determine who will provide the best rates for that insurance.
Even to keep costs down, it’s important not to have too little coverage.