Liability insurance

[IanR]

A novice question re aircraft insurance - what is the standard level of liability cover in private aviation insurance ? $10M ?

 

 

[Guest Andys@coffs]

Ian

 

Dont forget that RAA aircraft registration comes with some liability insurance anyway, IT isnt, in my opinion, sufficient, but when you are buying remember to make sure the broker notes thet RAA insurance and that what ever additional you buy doesnt get called on until the RAA insurance is exhausted. That menas that the risk of it being called on is much less and you should therefore pay less........of course all that assumes its RAA registered and that may be a fataly flawed assumption

 

Rather than ask us, I suspect you should be asking teh broker(s) that question. To me it isnt about the amount that you insure but rather the amounts that are being awarded when events occur..... if the amount that is awarded is likely say $3m then whether you buy $3m of coverage or $10m of coverage the risk to the insurer is only marginally greater if you buy $10m of coverage and therefore only marginally more expensive...... Or does that not sound logical?

 

Andy.

 

P.S why dont you PM Kaz and ask her, with her legal background she's likely to give you a much more intelligent answer than most of the rest of us could.

 

 

[Wayne T Mathews]

Your question is a bit like asking the size of someone's jock strap, Ian. And the answers you get may well be about as truthful. But the people I've been talking to, in the main, have said for a while now that they're carrying $10M. Some, especially insurance salesmen and scaredy cats, have been suggesting lately that we should up our protection and carry $20M.

 

 

[turboplanner]

The scaredy cats might be thinking that if they spear in to an airport without using their radios, contrary to the duty circuit they may cause a dash 8 to be taken out, for which they will be liable.

 

or a similar multiple.

 

If you keep up with the news items on public liability it looks like a fatality is going to cost you around $1 to $1.5 milion, a quadriplegic around $7 to $10 million and loss of a limb maybe $150,000 plus legal costs which might be $400,000 to a million or so if the case is complicated.

 

So a bit depends on where you fly.

 

 

[IanR]

Thanks guys - just wanted to get a view on what people have at the moment - liability is by far the biggest part of the quotes I have got for insurance for the Auster !!

 

 

[facthunter]

The last board meeting I attended, (Must be about 2+ years ago)The matter was discussed and the industry view was that 10m, was about the minimum. Insurance people always want to up the amount covered. It is not anything like a pro rata charge, but the general feeling is that the higher the coverage , the higher will be the awarded figures. ( Chicken and egg thing) Nev..

 

 

[turboplanner]

It would have been more advisable if they'd allocated someone to do some research instead of airing general feelings. Courts are awarding based on the plaintiff's ongoing care requirements - a much better system than the US.

 

 

[68volksy]

General rule of thumb is $1million per seat in the aircraft in my dealings with the brokers.

 

 

[kaz3g]

Thanks guys - just wanted to get a view on what people have at the moment - liability is by far the biggest part of the quotes I have got for insurance for the Auster !!

Hi Ian

 

I use RGIB and have found them competitive and helpful.

 

Try:

 

Aaron Stephenson

 

Managing Director

 

Phone: 1300 620 520Int Ph: +61 2 9843 5500Fax: 1800 802 956Mobile: 0417 292 209Email [email protected]Postal Address: GPO BOX 3595 SYDNEY NSW 2001

 

kaz

 

 

[turboplanner]

OK 68, you've got two seats, that's $2 million cover

 

You were looking out the window (and so negligent) and round out 20 feet too high, stalling into the ground. Your passenger breaks his back and now needs professional care for life, remodelling of his house etc, He's 25 so this money will be required for the next 50 years.

 

The Court awards him $6.2 million to cover these reasonable costs.

 

Your insurer covers you for $2 million, but you're out of pocket for $4.2 million.

 

The broker may well be selling policies at that value because that's the touchpoint of what people tell him they can afford. He's entitled to do this and doesn't have any obligation to point out worst case scenarios like I just did.

 

 

[68volksy]

Quite right turbo - but where do you draw the limit?

 

 

[turboplanner]

Sent a response on the phone earlier today but it didn't make it.

 

You check the newspapers for payout values, and you don't hit a Dash 8

 

 

[68volksy]

You can never have too much insurance - just have to way up cost versus risk as with many things. Owning your aircraft through a company structure is a great way of limiting the liability - especially if you have a few. I've recommended this to many clients. Something to think about anyway.

 

 

[turboplanner]

Dangerous thing to recommend 68, I would stronstrongly recommend you talk to a specialist Public Liability law firm.

 

 

[68volksy]

I've run it past several lawyers - one of them's a client actually. Are you suggesting a public liability claim could possibly pass through the company and on towards the directors? Company law is pretty straightforward about what liabilities can pass through to the directors - trading whilst insolvent and employee pay and super being the primary issues.

 

Haven't heard of any cases where they were able to ping the directors for anything other than the above issues. It's why the word "Limited" appears in a company name after all. If there's evidence to the contrary though it would be most prudent of me to hear it.

 

 

[turboplanner]

Public Liability law 68, Public Liabilty law - it's like cricket vs football.

 

One possible example isif you are charged and found guilty of culpable negligence, who do you think would be on the defendents list?

 

 

[Old Koreelah]

Owning your aircraft through a company structure is a great way of limiting the liability...

So you cause a prang. Survivors or their families sue you, the pilot, because the firm which owns the aircraft is insolvent.

 

 

[facthunter]

The lawyers follow the money. By and large THEY have a lot to answer for. 99% of them give the rest a bad name they say.

 

I think the answer would be to go to a peaceful 3rd world country and just do it, though in most of those places if you run over a local even if they ran out in front of you, you get attacked and killed. Hopeless eh! Nev

 

 

[turboplanner]

So you cause a prang. Survivors or their families sue you, the pilot, because the firm which owns the aircraft is insolvent.

Your post says you caused the prang so the primary defendant will be you rather than the aircraft, and hopefully you'll be covered by insurance.

 

If a manufacturing fault causes the prang (say an aileron hinge is faulty and you lose an aileron) then the primary defendant would be the manufacturer, and the plaintiff has to prove negligence on your part to get to you.

 

These people aren't dumb - usually where they summons a number of people there are degrees of negligence. For example, say the aileron hinge did fail, but you had told someone it was faulty some time before, or you had ordered replacement parts but flown before they were received, you could not only expect to get a summons, but might even let the manufacturer off the hook.

 

A lot of posts on this forum follow the above paragraph, where someone is publicising the fact that they know their aircraft has faults, or boast about not following safety procedures, and they form natural cannon fodder when something goes wrong because the admission has already been advertised.