Explore Aircraft Insurance Before Building or Buying
By Bob Mackey, Vice President, Falcon Insurance Agency, Inc.
When I first became an insurance agent, someone told me that everything is insurable. A movie star's legs…original art work…hole-in-one golf contests…and million dollar, full-court basketball shots. As long as someone was willing to pay the premium, I was told, anything is insurable. Nearly 28 years later, I realize that's not totally true. The fact is, some things are not insurable, not at any price!
In recreational aviation, I've seen too many situations when someone wants insurance but can't get it, or if they can, the terms, the insurance provider, or the price are extremely unsatisfactory.
Here is an example that has happened.
A pilot who earned his private ticket in 1970 flew for maybe five or six years and accumulated 120 hours, including 70 hours of training towards his license. Since then he's been inactive. Now he decides it's time to buy an airplane and get back into the swing of things.
He investigates by reading many articles, visiting numerous websites, and attending a few fly-ins. Finally he decides to buy a brand new "Belch-Fire 42," a four-place, 20,000 feet-plus screamer that goes like stink and costs a small fortune. He makes the buy and begins to dream about soaring across the country.
Then he calls the EAA Aircraft Insurance Plan, 866-647-4EAA (4322) to line-up insurance, figuring all that's required is a couple of hours of check-out with a CFI.
The truth, however, is something very different: He'll need 500 hours total flight time, an instrument rating and a high-performance endorsement (with a least 100 hours of high performance time); 100 hours of retractable gear time; and 25 hours of dual instruction in the Belch-Fire 42.
Needless to say this all adds up to a whole lot more than expected, not to mention a bunch of money you hadn't planned on spending.
Is this situation abnormal?
Unfortunately, this isn't as abnormal as you might think. I've made this particular situation extreme, but I'm doing that to make a point. When we set ourselves up for disappointment it's usually because we haven't done our homework. Sure you might be able to get insurance, which will be very expensive, and the insurance will be placed in an insurance company that might be a little difficult to deal with if there is a claim, but is this how you want to buy insurance? I don't think so.
To avoid getting caught in the insurance nightmare trap, don't buy it or don't build it unless you know you can insure it!
First, you should pick up the phone and call the EAA Aircraft Insurance Plan administrated by Falcon Insurance Agency and talk to the insurance pros. Tell them what you are thinking about and ask about getting insurance. This will take you less than 10 minutes and you will know right then and there where you stand. Sure, the airplane you've been dreaming about might have to wait, but that's the nice thing about airplanes: they're usually around for a long time.
Number two, be prepared to listen to some advice from the pros at the EAA Insurance Plan because they want to see you happy and flying the right airplane.
Third, when you've got the best airplane for your skills, the best insurance at the best price, you'll also get the best service available. It's a win-win outcome for everyone. Some day you'll own that Belch-Fire 42, maybe not today, but someday, so why not make it the right day?
EAA INSURANCE TIPS is a special EAA Member benefit. If you have an insurance related topic you’d like to see addressed or if you have any comments, please email email@example.com. If you need an insurance quotation call 866-647-4EAA (4322).