Nov. 26, 2019
Business aircraft operators are seeing sharp hikes to their insurance premiums when it comes time to renew their coverage or insure a new aircraft. However, there are steps they can take to minimize those increases.
“The insurance market has bottomed out just as we’re seeing a skyrocketing number of catastrophic loss claims,” said Joseph Braunstein, managing director and general aviation practice leader at insurance broker Marsh USA. “Underwriters are now pushing sizable increases because they must remain viable.”
That said, there are measures operators can take to find the right insurer and combat higher premiums.
“Invite your underwriter to your facility and instill in them your flight department’s safety culture,” Mike Nichols, CAM, CAE, NBAA senior vice president of strategy and innovation recommended. “Highlight your safety culture, compliance with IS-BAO, safety management systems and your training proficiency, including recurrent and additional training.
“I’m amazed to hear about companies that don’t take any steps to tell their safety story, or even fill out their insurance company’s questionnaire, and are then surprised to see their premiums skyrocket,” he continued. “Now more than ever, operators need to sell themselves as a manageable risk to their insurers.”
Braunstein noted operators should also plan for a lengthy process.
“We used to start the renewals process around 120 days prior to expiration, but now those conversations begin as long as six months before,” he said. “This can’t be a rushed proposition; be extremely detailed and thorough with the information you present.”
Listen to an NBAA Flight Plan podcast on mitigating rate hikes.