The Aviation Insurance Hard Market factors continue to pile up: 1. 2018-Present Loss Ratios have cut deeply into reinsurance revenue from several disasters and tragedies worldwide. 2. Aviation claims, lead by the Boeing losses, are now well over $2B for the same period. 3. Aviation insurance rates were very low for more than a decade…
The pandemic has been cruel to weak businesses and weak immune systems. Businesses that were struggling and people who were struggling with underlying conditions have been the highest number of victims. It has also been a catalyst for businesses and industries. In my involvement with many entrepreneurs throughout the crisis I have observed that the…
There has been a lot of insinuations that the pandemic is changing the aviation insurance marketplace significantly. Our experience suggests this is not yet the case as respects General Aviation (GA) because the aviation insurance market was already in a critical moment. Another reason is that GA demand has not declined. However we do believe…
An aircraft dry lease is a contract whereby 2 parties agree that one can lease an aircraft from the other. The dry lease CANNOT result in any profit for the aircraft owner, the reason behind this is simple: If you provide an aircraft service in exchange for profit then you are required by law to…
This was posted today on a public forum: “I learned a tough lesson this year in regards to our commercial insurance. THE BROKER MAKES ALL THE DIFFERENCE!! The broker I have been using for 25+ years was operating on autopilot, just figuring that the expiring policy would just renew. Because of claims paid for 2…
For the past year we have been transitioning into the hard market for aviation insurance. The transition has been very tough both on aircraft operators (rate increases, less coverage options) and aviation insurance underwriters (several company closures with layoffs). Purely based on experience during the last hard market in 2002, the hard market cycle is…
Insurance rates for aircraft maintenance companies are based on 4 main factors: What type of maintenance is done: If the company is overhauling engines, then the insurance is much higher than if they are performing routine maintenance and sending specialty overhauls to specialty shops.How much revenue. The revenue is a factor because it’s the way…
As we discuss the aviation insurance marketplace with our clients we focus on the consequences for them: higher rates, reduced coverages, fewer options, and stricter training requirements. But the big picture and understanding what is happening on the underwriting side is important for all stakeholders to work together. Reinsurers endured the largest claim year in…
It has now been more than 3 months since the 737 Max grounding by aeronautical authorities around the world. Here is a breakdown of our estimated insurance claim on Boeing’s Products Liability policy and its Grounding Liability Coverage: Average flights per aircraft per day: 5 Average passenger seating: 150 Average revenue per passenger: $180 Total…
US aviation insurers continue to offer a maximum per-seat limit for reciprocating engined aircraft of $100,000. As the market has hardened this year there are fewer higher limit options available for consumers therefore more are being forced to accept this limit. The standard $100,000 per seat limit has gone unchanged for at least 20 years.…