Buyers of coverage for aircraft, aviation businesses and property have found a silver lining in the recession: relatively stable prices for insurance. Attendees at this year’s Aviation Insurance Association (AIA) conference confirm the news; too much available insurance capacity means that no underwriter has the power to raise prices.
Types of insurance
The Aviation Alliance Insurance Risk Retention Group (AAIRRG), developed by the Alexandria, Virginia-based Aeronautical Repair Station Association (ARSA) and Polaris Enterprise Group, received its certificate of authority (insurance license) this week from the state of Montana. AAIRRG will provide product-liability insurance exclusively to repair stations that are ARSA members.
The February 6 collapse of the Dulles Jet Center roof under a heavy blanket of snow– and the estimated $300 million worth of corporate jets damaged or destroyed in the event–has raised questions about insurance liability.
In an economy that has ravaged aviation, one stable segment is the insurance industry, but change is coming. “Nobody knows what [the future is] going to look like,” an industry expert told AIN.
The 24th annual NBAA maintenance management conference was held in New Orleans last week.
“You can bet the insurance market is going to change. All the ingredients are in place and it’s only a matter of time,” Jim Gardner, v-p of Insuramerica Aviation, an affiliate of J. Smith Lanier, told AIN.
As of this month, USAIG (U.S. Aircraft Insurance Group, Booth No. 1730) has contributed more than $5.1 million toward Bell, American Eurocopter, MD Helicopters and AgustaWestland training programs through the company’s preferred policyholder program.
Wichita-based PIM Aviation Insurance, an insurance broker serving the business and commercial aviation market since 1982, recently added life insurance for pilots to its portfolio. Pilots interested in obtaining a free quote can stop by Booth No. 5111. PIM partnered with several insurance companies willing to provide competitively priced life insurance for pilots when they are operating aircraft, the company said.
To better understand insurance it helps to understand what it really is. The historical foundation of insurance is that disaster can strike anyone, at any time. The concept of insurance is the good fortune of many helping provide for the bad fortune of a few.
There was no such thing as aviation insurance when Shakespeare penned, in Henry VI, “The first thing we do, let’s kill all the lawyers.” If there had been, the quote might have been a bit longer, according to many in the industry. Next to lawyers, everyone loves to hate insurance agents and underwriters.