Why Pilots Need Personal Liability Insurance

The notion that pilots need to personally insure themselves against lawsuits and other insurance claims may come as a surprise for some. After all, the aircraft they fly—whether their own or not—are already insured, as are third-party aircraft operators. So, why does a pilot need personal liability insurance? Rick J. Lindsey, president, CEO, and chairman of Prime Insurance Company has an answer. He is a pioneer in protecting pilots from

accident-related liability claims. “When an accident happens, claimants are looking for multiple sources of compensation, and that includes the personal estate of the pilot involved—whether alive or dead. This is why so many claimants and insurance companies name everyone they can in their lawsuits,” he says.

There is a growing trend by lawyers and insurance companies to go after individuals, especially trained professionals. “Any aircraft owner can seek reimbursement from pilots for the deductible and for increased insurance premiums,” says Lindsey. Furthermore, owners and pilots are separately liable for accidents under FAA regulations; there is

no protection in place for pilots who don’t protect themselves with personal liability insurance.

Still, doesn’t a pilot’s current insurance regularly protect him or her from personal liability lawsuits? Lindsey answers with a warning: “If you haven’t read the fine print on your aviation insurance policies and found clear wording that proves that your insurance provides personal liability coverage, then it doesn’t. Meanwhile, the claimants’ insurance companies will be all too happy to go after your personal estate, as well as go after your insurer company. Anything they can get from you is money that they don’t have to pay out of their own coffers to claimants.”

Affordable Protection

Helicopter pilots reading this article, now suitably terrified about being personally liable, should consider what personal pilot liability insurance can affordably offer. Lindsey says, “The key is to identify your actual level of risk first, and then buy the personal liability insurance you need. You can buy tens of millions of dollars’ worth of expensive personal liability coverage, but if you are a weekend helicopter pilot who flies low-risk missions over farm fields and forests, you could end up paying more than needed.”

When a helicopter pilot, or indeed anyone else who runs the risk of being personally sued for their activities, approaches Prime Insurance for personal liability coverage, Lindsey starts by asking them a lot of questions. “We ask about three specific areas of life: What do you do at work, home, and play? Once we know how you live your life and what risks you run, we can get a sense of what level of personal liability risk you are—and are not—running.” Prime Insurance further reviews lifestyle, health, work conditions, accident history, and any other factors that affect how much a pilot will pay for insurance. In doing so, the company is not trying to get as much money for premiums as possible. Rather, Lindsey will frequently advise pilots to get less coverage than they might initially ask for, if their level of actual exposure to potential liability justifies it. “The point in getting personal liability insurance, or any form of insurance, is to get what you need so that you only pay what’s needed,” says Lindsey. “The more insurance you have, the more it costs. The goal is to precisely determine how much coverage you need. Pay for that—and no more.”

What about the price? “For most pilots, $1 million of personal liability insurance can cost about $2,900 a year,” says Lindsey. “It can cost less for student pilots, and for those whose flying and exposure to causing damage is less. Remember, your actual rates depend entirely on your life, work, piloting time, and circumstances.”


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