Airplane insurance costs are based on several factors. When obtaining an insurance policy, one of the most important aspects that we can recommend is that you choose an aircraft insurance specialist to guide you through this process. Airplane insurance costs are determined by an assortment of underwriting criteria and how your underwriter weighs this data. The aircraft type and specific make and model combined with that aircraft’s specific loss ratios are an obvious factor. On top of that, aircraft insurance costs vary depending on the actual pilot’s experience. Your home airport location and operating territory or mission can factor in to airplane insurance costs as well.
Aircraft type is an obvious source of differing aircraft insurance costs. We all understand this but let’s investigate WHY the aircraft make and model factor in so much. Each aircraft make and model has “actuarial losses”. This is a math equation that shows over time how many losses each aircraft has compared to the number of units flying and the hours flown by those units. An aircraft with a high loss per unit ratio can have higher prices per unit to insure. Another important factor in the aircraft type and how it affects aircraft insurance costs is the cost of and availability of replacement parts. The cost to repair a specific aircraft make and model can cause aircraft insurance prices to change.
Pilot experience is one of the most important things affecting airplane insurance costs. Higher time, more experienced pilots typically see lower aircraft insurance costs than lower time pilots. This price gap can be larger when compared with more complex aircraft. Typically, the more complex the aircraft is to fly, the wider the spread in airplane insurance costs between experienced and inexperienced pilots. Trainer aircraft and simpler to fly aircraft will see a narrower gap in aircraft insurance costs specifically because the loss ratios for higher time pilots are similar to the loss ratios for lower time pilots.
The airport base that you choose can affect airplane insurance costs. Although runway surface and runway length can somewhat affect aircraft insurance costs, the deciding factor can also be what type of aircraft you are flying from that strip. Imagine a 2500ft dirt strip surrounded by trees. A smaller tail dragger aircraft may be a better fit for this mission than a twin turbo prop. Conversely, a high-altitude airport may be a better mission for a more complex aircraft. When comparing aircraft insurance costs, the aircraft being a good fit for the airport, territory and mission can factor in.
Now for the sales pitch…… Your broker can play a HUGE roll in your aviation insurance costs. By representing the right insurance carriers and understanding the insurance carrier’s appetite, an experienced aviation insurance broker can find a better fit for your aircraft insurance needs. Travers Aviation Insurance has the specific skill set to accomplish this for you. Not only having the contracts with these insurance carriers but understanding which INDIVIDUAL UNDERWRITERS at these companies favor certain risks can make a huge difference in your airplane insurance costs. An example would be an underwriter who flies your make and model of aircraft would be a good fit to insure one for you. Knowing these factors can certainly affect your aircraft insurance costs and sometimes even the availability of insurance.
