Specialty Aircraft And Airports Insurance

Specialty aircraft and airports insurance refers to a specific type of insurance coverage that is designed to protect the unique risks and exposures associated with aircraft and airport operations. This type of insurance is typically tailored to meet the needs of specific industries and businesses that operate aircraft and airports, such as airlines, charter companies, corporate flight departments, and airport operators.

One of the main risks associated with aircraft and airport operations is the potential for accidents and incidents. Specialty aircraft and airports insurance can provide coverage for a wide range of incidents, including aircraft crashes, ground damage, liability claims, and loss of income due to aircraft downtime. This coverage can also include protection for third-party liabilities, such as damage to property or injury to individuals on the ground.

Another important aspect of specialty aircraft and airports insurance is coverage for aircraft and airport equipment. This can include coverage for damage to aircraft and airport infrastructure, such as runways, taxiways, and buildings. This coverage can also provide protection for the cost of repairs, replacement, or lost revenue due to equipment downtime.

In addition to these traditional coverage options, specialty aircraft and airports insurance can also include coverage for a wide range of other exposures. For example, this type of insurance can provide protection for cyber attacks and data breaches, which can be particularly important for airlines and airport operators who rely heavily on electronic systems and data. Other coverage options may include protection for environmental hazards, such as fuel spills or aircraft fires, as well as protection for political risks, such as war or terrorism.

Overall, specialty aircraft and airports insurance is an essential component of risk management for any business that operates aircraft and airports. With the right coverage, these businesses can protect their assets, operations, and revenues from a wide range of risks and exposures. Additionally, specialty aircraft and airports insurance can also provide peace of mind for business owners, allowing them to focus on their core operations and growth, without worrying about the potential for accidents, incidents, or other losses.

Air carrier movement of freight in interstate and international commerce is growing in volume and importance. These carriers usually purchase air cargo legal liability coverage (similar to motor truck cargo legal liability coverage) to protect against liability arising from the shipping document (the air waybill). The air carrier may also need shipper's interest coverage if it provides cargo insurance to the shipper.

Aviation insurance is usually written by carrier pools or individual companies that specialize in this business. Most coverage is written for general aviation, a diverse industry that includes all forms of flying except commercial airlines and military operations. The four major classes of aircraft owners/operators are industrial aid, business and pleasure, flying clubs, and fixed base operators. Aircraft hull and liability coverage is similar to the coverage an automobile policy provides because it includes physical damage, liability, and medical payments coverages. Under hull insurance, the two types of coverage available are physical damage coverage when the aircraft is not in flight and physical damage coverage when it is in flight. Liability coverage is similar to automobile liability, except that it is divided into two separate insuring agreements, one for bodily injury excluding passenger liability, and the other for passenger bodily injury liability. Medical payments coverage may be added if passenger liability coverage is provided.

Products liability coverage for aircraft manufacturers and aircraft products dealers is difficult to place. Loss potential is significant because of the catastrophic consequences when a product used in an aircraft fails in flight. Fixed based operators and others who repair and replace aircraft parts may also need this coverage.

Aircraft hull policies exclude aircraft spare parts. If a part, such as an engine, is removed from the aircraft to be repaired, and in order for the aircraft to be used, a loaner is attached to the aircraft, the part removed is not covered. Coverage for that spare part must be purchased separately from the aircraft hull policy. Insurance purchased covers aircraft engines, spare parts, and equipment that are on the ground, or that are being carried as cargo by air, land, or water conveyances. Coverage ends when the equipment is fitted to the aircraft. This coverage does not cover engine loss or damage while the part is running or being tested. It also excludes mechanical or electrical failure loss or damage to detached property once it is refitted to the aircraft or to property carried on the aircraft as a spare parts kit. Each loss that results from one event is adjusted separately.

Airport operators or fixed base operators need airport liability coverage and hangarkeepers legal liability coverage on their operations. Aviation liability coverage forms provide this coverage. Aircraft hull and liability coverage is also needed when the operations include ownership and rental of planes to individual pilots or student pilots.

Airport property and aviation-related risks coverage forms and policies have been developed to cover the full spectrum of airport and aviation ground exposures. The major coverage areas are buildings, business personal property, and transit, loss of business income, extra expense, inland marine, and auto. Coverage can also be provided for owned hangars, terminal buildings, towers, fuel farms, manufacturers, fixed based operators, tour services, maintenance facilities, and modification centers. Off-airport aviation-related risks such as avionics repair shops and component manufacturers can also be covered.

It is difficult to place hull and liability insurance for aircraft that are no longer produced. A damaged antique aircraft is expensive to repair because original replacement parts may no longer be available. As a result, individually fabricated parts are required. Underwriting the exposure concentrates on the pilot's qualifications and experience in flying the particular type of aircraft because each has its own unique handling characteristics.

Drones (Unmanned Aerial Vehicles) are becoming essential tools for many industries such as real estate, photo journalism, and property claims adjusting. They are growing in popularity in other industries as the technology improves and applications are developed. Physical damage coverage and bodily injury, property damage, and personal and advertising injury liability are needed.

A ferry flight (or delivery flight) occurs when an independent contractor flies an aircraft from a seller to a buyer. Ferry flight insurance provides hull coverage for physical damage to the aircraft and liability coverage for damage the aircraft causes during the transport. This coverage can be purchased by the buyer, the seller, or the independent contractor. Key considerations in underwriting are the pilot's experience with the specific type of aircraft and the pilot's knowledge of the flight route. Coverage is available worldwide. The physical damage limit is based on the aircraft's value. Liability limits are generally capped at $1,000,000 for general aviation aircraft but higher limits are available for commercial airliners. These markets provide this coverage:

This class of business is more properly classified as special risk aviation insurance, and Lloyd's of London has traditionally written the coverage. However, a few domestic markets have facilities to provide physical damage, liability, and passenger coverage. Helicopters are probably the least desirable class of aviation business from the underwriting standpoint because they are very fragile and highly susceptible to damage. Pilots must be highly skilled in operating them and be extremely aware of and sensitive to wind conditions. Domestic markets offer limited hull and liability coverage for various classes of commercial use, forest fire patrol, traffic patrol, air ambulance service, and industrial aid uses.

Recreational enthusiasts and companies use hot air balloons to provide rides for themselves and their customers. They may also use the balloon to provide other services such as advertising. Coverage is available for physical damage to the balloon and liability for damage to the property of others and bodily injury to passengers and non-passengers.

This coverage is primarily about satellites. As a rocket has multiple stages, so does the insurance. There is pre-launch, launch, and in-orbit coverage for physical damage to the satellite. There is also third party and re-launch guarantee coverage. Pre-launch insurance covers the satellite until it is launched. This includes transporting it from the manufacturer plus any storage or assembly at the launch site. Launch insurance covers the satellite for physical loss or damage during the launch sequence and also for the satellite failing to achieve its designated orbit. The launch stage also covers the satellite failing to perform as specified once it reaches orbit. In-orbit insurance is protection against the satellite failing to operate successfully when it achieves its required orbit. Third-party insurance protects the insured against third-party claims that arise from an occurrence associated with the mission including damage to various earth stations and transmission towers and equipment. Re-launch guarantee coverage provides a free re-launch to a customer when an error by the insured causes a launch failure.

Following are some examples of Specialty Aircraft And Airports Insurance claims and the corresponding insurance coverages that can help pay for them:

Example 1: Runway Damage
An unexpected landslide or earthquake can cause significant damage to an airport's runway. A claim might be filed under the Specialty Aircraft and Airports Insurance to cover the cost of repair. The insurance policy can help pay for the lawsuit by covering the cost of legal defense, possible settlements, and any awarded damages if the airport is sued for disruption of services due to the damaged runway.

Example 2: Aircraft Hangar Fire
A fire breaks out in an aircraft hangar, causing substantial damage to the aircraft stored within, including privately owned planes. The owners of the damaged planes may decide to sue the airport for negligence. Specialty Aircraft and Airports Insurance can help pay for the legal defense costs, any settlements reached, or court-ordered compensations, thus alleviating the financial burden of the lawsuit on the airport.

Example 3: Air Traffic Control Error
An air traffic control error results in a near-miss incident. Although no physical damage is caused, the passengers on the involved flights might sue the airport for emotional distress. The Specialty Aircraft and Airports Insurance can step in to cover the legal costs, settlements, or court-ordered damages, providing much-needed financial support to handle the lawsuit.

Example 4: Airport Premises Liability
A visitor slips and falls on a wet floor within the airport terminal, leading to serious injuries. The injured party sues the airport for medical expenses and compensation for pain and suffering. Specialty Aircraft and Airports Insurance can help by covering the costs of legal defense, medical expenses for the injured party, and any compensations awarded by the court.

Example 5: Damage to Specialty Aircraft
A rare, vintage aircraft is damaged while on display at an airport museum due to a structural failure in the display hangar. The owner of the aircraft sues the airport for the high costs of repair or replacement. The Specialty Aircraft and Airports Insurance would cover the legal defense costs, any settlements or court-ordered damages, protecting the airport from significant financial loss.