Business Aviation Insurance Considerations for International Ops
Standard worldwide insurance is sufficient for many areas of the world – but not all. There are insurance wording and format nuances to be aware of here and there internationally. A small formatting inconsistency, for example, may cause your landing permit for Hong Kong to be denied. Likewise, when operating to some Latin American countries, your insurance policy must be in Spanish. It’s important to be aware of the many unique insurance coverage requirements when operating to the four corners of the world.
The following is an overview of what you need to know:
1. Be aware of unique insurance requirements
Many countries and regions have their own particular insurance coverage limits, format and wording requirements. Your documentation must comply with local insurance practices, or in most cases you will not be able to secure operating permits. Examples of countries/regions, with particular and unique insurance requirements include the European Union (EU), Mexico, Germany and Hong Kong.
2. Insurance requirements may differ depending on your type of operation
Many countries have different insurance requirements for private non-revenue and charter (non-scheduled commercial) operations. For example, Mexican insurance policies should clearly state "private" or "commercial" for the use of the flight. In many cases, these differing insurance requirements are one more means used by local aviation authorities to ensure that charter operations coming into the country don’t do so under the guise of private operations. Your insurance provider will be able to generate correct coverage and policy wording for you. Be aware that the wrong insurance format can lead to fines and your aircraft being held on the ground until a correct policy is presented. You may be caught as a result of a routine ramp check.
3. Standard worldwide insurance will often not be sufficient
Talk with your insurer and 3rd-party provider to determine any unique coverage requirements or policy formats that may be needed when traveling to certain areas. For Mexico, you must have specific Mexican insurance coverage, and documentation must be in Spanish. Venezuela requires somewhat unique coverage (including specific medical coverage), and documentation also must be in Spanish. Hong Kong is particular when it comes to specific policy wording. The Hong Kong authorities require, for example, that all dollar figures be in numeral format and also spelled out. If the policy format doesn’t comply with all the requirements, your landing permit may be denied. When traveling to the EU, you’ll need EU insurance with coverage denomination in Special Drawing Rights (SDRs). The value of the SDR is determined by the value of several currencies. Land at a joint-use civil/military airfield in the UK, and you’ll be required to have "crown indemnity" insurance coverage referenced in your policy. Also, some countries require you to carry specific "war risk" insurance.
4. An EU insurance policy may not be sufficient for ops to the EU
If you’re operating a charter to either Germany or Italy, you’ll require specific insurance coverage, and wording, beyond what’s normally necessary to meet EU insurance standards. As regulatory mandates are somewhat changeable and fluid, it’s always best to check with your 3rd-party provider, and insurer, well in advance of travel.
5. Your insurance provider may need to complete specific forms
Italy has a specific template for charter operators and wants the insurance provider to fill out and sign this form. Germany, and certain countries in Asia, also have specific insurance forms and formats that must be complied with. For war risk coverage, you may be required to specify the country in order to operate to or overfly the country in question.
6. Insurance documentation may be part of the landing permit process
For many countries/regions – including Brazil, Mexico, Russia the Middle East and Hong Kong – operators must provide evidence of insurance coverage as part of the landing permit process. Common information that must be supplied to local Civil Aviation Authorities (CAAs) includes aircraft registration, serial number, type of operation (private non-revenue or commercial), coverage territory, insurance policy number with policy start and stop dates, coverage amounts and value of the aircraft. In the EU, you’ll also need to specify cargo and baggage coverage with minimum coverage requirements. Policies without specific expiration dates will not be accepted by Russia and other countries.
7. The name of the insured is important
Many operators have their aircraft registered under one company but operate under a different name. CAAs want the name of the insured to match the operator of the aircraft. They’ll want to see evidence of a link between the name of the insured owner – it may be a bank or a management company – and the company actually flying the aircraft. Problems can be encountered if you change the registration or tail number of an aircraft and do not update insurance documents.
8. Be aware of best practice tips
Always ensure that your insurance policy is valid for the entire duration of the planned trip. Read through insurance documentation carefully, always carry a copy of your current insurance policy onboard and leave a copy with your 3rd-party provider for backup. Prior to each international trip – particularly when traveling to areas of the world that may be new to you – confirm with your insurance and 3rd-party provider that coverage is appropriate for your specific destinations. If you or your insurer is unsure of particular insurance coverage requirements at certain destinations, it’s important to confirm those requirements with your 3rd-party provider. Experienced 3rd-party providers may be able to send you, and your insurer, a template or example of local requirements to utilize to help create a policy that’s compliant.
9. Advance research of insurance requirements is important
Ensure that you have an original insurance document correctly signed by your insurance provider in case of a ramp check. Confirm that verbiage is correct – line by line and word by word – as per local CAA requirements. Be aware that CAAs at many destinations require a summary page of your coverage policy prior to issuing permits. Check to ensure that your insurance policy is valid and renewed each year.
Your 3rd-party provider is a valuable resource in helping to confirm that you have appropriate insurance coverage in a format that meets requirements of CAAs at intended destinations. Best practice is to review insurance coverage with your 3rd-party provider, on an annual basis, and to keep a backup copy of your current policy with your provider in the event that you require access to it when operating far from home base.
If you have any questions about this article or insurance requirements, contact me at firstname.lastname@example.org.