International Aviation Insurance Requirements: Part 2 – Complying with Local Mandates
This business aviation blog post continues from our article last week, entitled "International Aviation Insurance Requirements: Part 1 – Local Requirements."
Business aircraft operators can avoid potential for operational delays and permit denials by verifying specific local insurance requirements in advance and adapting their policies accordingly. There are typically specific items mandated by each country that must be included in insurance documentation, and without them there will be issues with associated permits or entry at a destination.
The following is an overview of what you need to know:
1. Ensure that your policy is correct
Local requirements for insurance coverage and format can be obtained from your 3rd-party provider, from your insurance provider, and even via appropriate Civil Aviation Authorities. Ensure you’re using an insurance provider well versed in special needs/requirements/verbiage for specific countries or regions. Always be sure that your policy indicates appropriate tail number, operator name, coverage area, minimum liability limits, and start and end dates. Best practice is to have an after-hours contact number for your insurance provider just in case something needs to be revised quickly.
2. Insurance coverage/documentation will usually be verified
Many countries request a copy of your insurance policy with landing permit requests. At destinations where landing permits are not needed, customs, immigration, and quarantine may check to ensure you have appropriate insurance coverage onboard. Certain countries require that you submit insurance documentation to customs on arrival. In some cases your ground handler may ask for a copy of the insurance documentation in advance to give to local authorities. Ramp checks are another way authorities determine that aircraft carry appropriate insurance coverage.
3. Charter policy requirements may differ from private non-revenue flights
Charter operators must often meet different rules, and different liability limits, compared to private non-revenue operators. For example Australia mandates specific insurance requirements for charter operators, and regulations from the "Carrier’s Liability Act of 1959" must be followed. Mexico requires policy wording to indicate "commercial" for all charter operations.
4. Know repercussions if insurance coverage is incorrect
If a landing permit is required and corrections are not made to the insurance policy, your permit will not be approved. This may cause operational delays. If a permit is obtained – but, when you arrive, the insurance policy you show does not meet specified requirements – delays may also result. At locations where landing permits are not required – and if upon arrival you show a policy that does not meet local standards – fines may be imposed.
5. Avoid common policy errors
The most common errors we hear about include operator names that do not match the insured party (usually in cases of managed or bank-owned aircraft), lack of expiration dates, and missing or incorrect aircraft registration or tail number. Travel to certain countries may be restricted on your policy, and this may need to be corrected depending upon where you’re operating. Additionally, there are cases where currency units are missing. Always ensure that your policy indicates USD, Euros, special drawing rights, or other accepted currency units.
6. Take steps to minimize policy errors/issues
Ensure that insurance policy copies are clear and legible. Be sure that your insurance and Standard Operating Procedures (SOPs) do not contradict one another with regard to limitations and exclusions. Ensure that your 3rd-party provider has a copy of your insurance on file. Inform your 3rd-party provider of any insurance or SOP limitations that may affect flight plans or trip planning to certain locations.
Always ensure you have appropriate insurance coverage, format, and wording for regions and destinations you’re traveling to. When you operate to regions with specific insurance requirements, it’s always best to arrange policy updates in advance. Be sure to allow yourself sufficient time in case revisions to insurance documentation are required.
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