Members liability insurance

[Guest Andys@coffs]

Folks

 

I was having a heated debate with some SQLD RAAus members over members liability insurance, they were claiming very recently that we had entered into an arrangement for 1/2 the coverage for twice the price......

 

Anyway went looking and found https://www.raa.asn.au/wp-content/uploads/2012/02/Members-Liab-Insurance-Explanation-290514.pdf which has been updated on the 29th of May 2014.

 

It doesn't cover costs per member for the policy but does identify the inclusions and limits.

 

A previous certificate of coverage can be found here http://www.raa.asn.au/wp-content/uploads/2012/02/Members-Liability-Insurance-Certificate-of-Currency-30-10-121.pdf and I'm stuffed if I can see any reductions on limits or extra exclusions other that we don't cover gyro's...but given we don't register them, I'm not sure that is a real reduction unless you are a member of both orgs and our cover is better than they have and you would want to claim against our cover for something that was not intended.

 

I don't see anything about cost in a document other than a member of the exec told me in words to the effect that there has been no materiel increase in costs.....

 

So...Don't believe everything you read unless there are documents provided to back the claims.....and so at this stage I think you can see no change in coverage...cost...that remains to be proved that there is no real increase.

 

Andy

 

 

[turboplanner]

Liability to PIC not included?

 

Let's say you owned the aircraft and had been failing to maintain it correctly and there was a structural failure as a direct result which would not have been visible in a normal preflight inspection, and the PIC becomes a quadriplegic.

 

In that case I would think you still had the duty of care and would be liable for the $6-$8 million, but the insurance doesn't cover that?

 

 

[Guest Andys@coffs]

PIC has never been covered from day 1, in fact that is one of the major reasons IMHO why additional personal insurance is an absolute requirement. So agree with sentiment but it hasn't changed

 

 

[turboplanner]

It's not good at all to have two different lawyers on the one case, and trying to separate which part of the blame/settlement relates to the PIC would be a nightmare.

 

I would strongly suggest any PIC take some PL and legal advice before getting into any split Insurance Supplier situation.

 

 

[Guest Andys@coffs]

The clause in my insurance says something to the effect that QBE will cover me for $X, where the RAAus Policy is the first port of call and QBE will cover any shortcoming in that policy coverage up to the QBE policy limit. To me that wording says the buck stops with QBE unless they can pass it to RAAus's insurer. Its my view that the onus to sort out whether its them or QBE lies with QBE, so over to them.

 

 

[TK58]

Members Liability insurance is due for renewal at the end of October. There has been no discussion yet with our broker, so all the rumours are just that - unfounded nonsense.

 

We have recently renewed the PI and PL insurance, which protects the association and its workers, not individual members. This policy costs less than 10% of the premium for the members' liability (about $30k compared with over $320k). We had a slight increase in premium, which given our recent claims history is unsurprising, but we also got an increase in cover.

 

 

[Guest Andys@coffs]

People details of the update tony spoke of is now available on the RAAus members portal. Have a look!

 

Important to note that this renewal is for more than 12months so that as of oct2015 all policies will renew at the same time. Why is it important? Well like at Coles and woollies if you buy 1 it's full price, buy 2 or more and they'll provide a discount......also important because our books are cash accounting and as such, unless things have changed, we will see the full term, which exceeds 12 months as a cost this year, if accrual accounting practises were setup and applied the whole amount would be booked to a balance sheet prepayment account and we would see a monthly journal as each month of insurance is consumed. So don't think it's all gone to hell when you see the annual report.

 

Andy

 

 

[DonRamsay]

We are fundamentally accrual accounting but on an annual basis. As you say we don't smooth costs or revenues across the year. Smoothing makes for more useful management accounts and makes month to month reports more comparable and year to date meaningful guide to full year.

 

 

[kaz3g]

Hi Andy

 

I fly an old GA aircraft slower than many RA machines. I pay my RAAus membership each year but I get little benefit other than the magazine.

 

Why can't the insurance scheme extend to all members whatever they fly in?

 

Kaz

 

 

[Guest Andys@coffs]

Kaz

 

Not sure I guess a question worth asking for next time its negotiated (October this year). Trevor Bange is the one who negotiated this deal but I suspect that the new CEO will be the main man for the October renewal...

 

I'll pass along your question....

 

Andy

 

 

[fly_tornado]

mission creep is only going to make the RAA more unmanageable.

 

 

[DonRamsay]

FT,

 

A member is a member and entitled to benefits RA-Aus can throw their way when it doesn't involve a cross-subsidy and in this case could actually help to reduce the costs for RA aircraft members.

 

Kaz,

 

I'm reliably informed this is being looked at and is likely to eventuate in the not too distant future.

 

 

[fly_tornado]

Adding a bunch of GA aircraft onto the RAA insurance policy will only make it harder for the RAA to get a better price.

 

 

[turboplanner]

Why is that?

 

 

[fly_tornado]

paperwork, you pass it onto the RAA, they pass it onto the the insurance company and then they send it back to the RAA and then they send it too you. With the RAA's previous performance they are bound to lose some and include someone else's paperwork.

 

The RAA shouldn't be a make work program

 

 

[Guest Andys@coffs]

Don't believe that RAA get in the middle at all, the claim is made between you the member and the insurance broker that RAAus appoint. The broker will want to see proof of membership for the time of the incident and that's pretty well it in terms of proving an entitlement to coverage, what value could RAAus offer by getting in the middle?

 

Your point about cost is possibly a valid one, today there is a restriction in place, removing it opens the insurer up to more risk and they price appropriately, whether that increase is material or not we wont know until negotiation time. I personally would be all for investigating it, and once we know the facts, rather than assume them, we can decide if we want to do this or not.

 

Insurance costs are one of the top 3 costs per year for RAAus, we are talking substantial cost size which of itself brings some power to the negotiation. We should use it!

 

Andy

 

 

[fly_tornado]

sizable? Australia buys 1M new cars a year versus the 150 odd RAA aircraft. RAA needs to slim down its operations and focus on its core role instead of getting further out of control.

 

 

[SDQDI]

If it doesn't increase premiums then that would be ok but if it did I don't see why RAA should cover us if we are flying VH using the privileges of a PPL whether we have a RAA cert or not, IMO it wouldn't make sense for us to be paying extra for someone not flying under the cert. doesn't seem fair on those without a PPL

 

If/when I get my PPL and start flying VH planes I would expect to pay my own insurance even though I would still have my RAA cert.

 

Although maybe we would have an influx of members from GA just for the insurance benefit

 

 

[fly_tornado]

Wait until hundreds of GA pilots start complaining about paying for 12 months insurance but only having 11 months of coverage due to technical issues.