What You Need to Know about Aviation Insurance

PT 3 M minute read
What Need to Know about Aviation Insurance

What Need to Know about Aviation Insurance

This is a post by author Gavin Naude. Gavin serves with specialist aviation brokerage firm Luftfahrt-Versicherungslösungen AG (LFV) headquartered in Zurich, Switzerland. Gavin is an expert on all aspects of aviation insurance and can be contacted at Gavin.naude@lfv-ag.ch.

It’s best practice to review aviation insurance policies now and again to confirm you have correct coverage at the best price. As your operating area and business missions change, it’s important to ensure that policy coverage, format, and wording are correct and comply with individual country requirements worldwide.

1. Aviation insurance providers vs. brokers

An aviation insurance provider is the actual underwriter of an insurance policy. He carries the risk and pays the claim. Aviation insurance brokers source and arrange the best insurance coverage and pricing options by canvassing the entire market of insurers. Brokers offer a range of services, including insurance advice, issuing insurance certificates and other required documents, confirming insurance coverage, and representing interests of all parties to a risk.

2. Know what to look for in an aviation insurance provider

It’s important to know the security and financial stability of the insurance provider. Ensure, also, that the provider is well established in the aviation insurance business and understands all the nuances, and differing requirements from country to country, of aviation insurance. All insurance providers must be licensed by relevant authorities to provide insurance, and individuals acting on behalf of providers and brokers must be individually licensed.

3. Understand problem potential when an aviation insurance provider is not familiar with individual country insurance requirements

Some of the problems that may arise include an insurance provider not being licensed in a particular country, not providing minimum liability coverages for particular areas as required by law, and not providing coverage for certain geographical areas. In some cases, a provider may supply the wrong insurance format for a particular country or coverage amounts that may not be in the correct currency denomination as stipulated by a particular country or region. The European Union (EU), for example, requires that coverage amounts be in special drawing rights (SDRs), while Hong Kong (VHHH) prefers that the coverage be denominated in U.S. dollars. It’s always best to be guided by a broker with intimate knowledge of varying coverage requirements and worldwide insurance nuances.

4. Be aware of all aviation insurance policy options

Standard aviation policies cover hull, passenger, and third-party liability coverage. Additional coverage can be arranged for malicious damage and “war risk” situations and to reduce deductibles on standard policies. You can also arrange for personal accident coverage for crew/passengers and “loss of license” coverage for pilots.

5. Be aware of documentation and other requirements

Your aviation insurance provider will need to know the details of your operations, full information on all aircraft in your fleet, and complete descriptions of crew training and experience. Also, insurers require information and full disclosure on any previous insurance claims.

6. Know insurance policy turnaround times

Insurance quotes, with all coverage details, can be accomplished in a few hours. In some cases, a quote can be generated within half an hour if the broker and insurance provider have all the relevant information. Keep in mind that turnaround time will often depend on office operating hours of the particular broker and insurer.

7. ICAO regulations do not impact business-aviation insurance policies

Insurers always expect the operators they insure to operate within the laws of the country they’re licensed in. Most of these countries already subscribe to ICAO regulations.

8. Learn more about country-specific aviation insurance regulations

Each country has its own regulations on what aviation insurance providers and brokers can and cannot do. These laws are normally under the auspices of financial regulatory authorities of the relevant countries.

9. Be aware of aviation insurance tips and best practices

Some business aircraft operators may be complacent in terms of the aviation insurance policies they have. It’s important to shop around if you even vaguely feel you’re not getting the best deal or service. It’s also beneficial to be part of a larger group policy. Insurance markets are always going through ups and downs in terms of policy pricing and coverage offered. Especially when insurance markets start to harden, it’s beneficial to be part of a larger group policy and take advantage of bulk buying power.


Always work with aviation insurance brokers who are intimately familiar with differing insurance requirements, coverage minimums, and policy format mandates of the regions and countries to operate to and overfly. And always be aware that, in some cases, you may need to alter standard liability coverage and revise wording/format of a policy to obtain a landing permit.


If you have any questions about this article, contact me at Gavin.naude@lfv-ag.ch.

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