AirBear

https://www.ainonline.com/aviation-n...Rpoatfr_KlqN-g

Short version, not looking good for the Aviation Insurance Business and premiums will skyrocket once flying returns to somewhat normal levels.

hindsight2020

Concur. We're already getting hit in recreational US piston market, down here in small fry land. 45% increase in my PA-28R policy, first upward change in 7 years, with no claims nor change in policy sub-limits. Had to switch to get it to a 25% increase, and had to give up Caribbean coverage. Underwriters are exiting the market left and right and brokers expect more of the same next year. As people get priced out of recreational aviation insurance (especially as the boomers turn 70+), this steepens the spiral of lack of volume, making it worse for the remaining players.

AirBear

I've read the worst hit are single pilot turbine equipment. The article I read even suggested charter operators start SMS (Safety Management System) programs to show that they were serious about reducing risk. I can't imagine what flight schools must be paying for their aircraft.

rickair7777

IIRC flight schools actually lower premiums because there is adult supervision and oversight for the students.

geosync

I'm in claims so I see it from the bent metal and dead bodies side. The good times were unsustainable. Non aviation insurance companies jumped into aviation because they saw pure premium numbers. Gobble up the volume with dirt cheap premium prices. Underwriters look good for a few years until the losses start rolling in, and lo and behold, not enough premium to cover them.

Airlines- endless slip and fall claims, overweight/old/professional claimants twist ankles, get hit with bags from the overhead bins. They sue the airlines and insurance companies have to hire defense counsel to defend the airline, which costs money, on top of the settlements. All these add up, on top of the major fatal losses. Even the major fatal losses if one or 2 people perish, plaintiff attorneys scoop up all the other pax who witnessed the incident and sue for mental anguish, and now the settlement numbers are in the 10s of millions.

Corporate- Not a lot of fatal accidents, like airlines. Professionals with good equipment. But even a hull loss is big money. A winglet on a G650 is 250k to replace and paint when the FBO tows it into a wall. Oh and now there is as loss of use claim, because in the meantime the boss/owner needs to charter a G650 to France while his plane is getting fixed, and no way in hell is he flying on an airline. So now its $500k when it's all said and done. If premium for that one aircraft is $20k, well, the insurance company needs 25 claimless years to break even on that account.

GA- Small business CEO in his CJ3 or PC-12 flying 5 -6 people flies into icing at night and kills everyone. That's 5 lawsuits right there, millions in settlements and defense costs, on top of the $2 million hull.

Guy buys a $400k Cessna 182, leaves the runway during a tough cross wind landing and flips it. Total loss. Premium $1k. The insurance company would need 400 years to make up that premium on that account.

Now those insurance companies are bailing, leaving the traditional aviation insurance companies that have been around for eons and know what they are doing.