State Of Minnesota Bridges Liability Coverage Gap For WSC And PPC Owners
October 15, 2007 — Thanks to the persistent efforts of EAA member Jerry Greuel, the State of Minnesota is stepping in to solve an insurance "Catch 22" for ultralight owners who are transitioning their "vehicles" to the experimental light-sport aircraft (E-LSA) category.
Minnesota state law requires aircraft owners to carry bodily injury coverage of at least $25,000 per passenger. Such insurance is not available for ultralight vehicles in Minnesota--or any other state--but with so many previously categorized ultralights being transitioned to registered, N-numbered aircraft now falling under the insurance requirement, a dilemma exists.
Gruel discovered this predicament in March 2007 when he went shopping for insurance on his T-Bird that he's transitioning to E-LSA. "I went to a number of sources and found out that coverage was not available," he said. Because liability insurance was mandated by the state, he contacted the Minnesota DOT's Aeronautics and Aviation Division for clarification but didn't get anywhere.
"I told them they were making us (transitioning ultralight owners) outlaws (by requiring insurance when none was available)," he said. About 2-3 weeks later the state got back to Gruel with a solution.
The Minnesota Joint Underwriting Association (MJUA) was created by the state legislature in 1986 to provide liability insurance coverage if it's required by the state but unavailable in the marketplace. Gruel was informed that he could obtain the required insurance for his T-Bird through the MJUA, with estimated annual premium of about $266 (renewable each July).
Because of their unfamiliarity with these types of aircraft, aviation insurance companies do not currently offer coverage for WSC and PPC, but EAA is working to persuade carriers to do so. The situation is much like the early days of homebuilding when insurance coverage was largely unavailable. EAA will continue to work this issue and, in time, we expect insurance will become available.
Hats off to Jerry (EAA 72997) for his efforts to resolve this issue in Minnesota.
Those members in Minnesota who would like more information can call the MJUA at 800-552.0013 or 651-222-0484, or e-mail firstname.lastname@example.org.