back down to the 2018 rate?” the answer is no. Te insurance companies have returned to underwriting practices that emphasize risk management. In other words, they’re vetting their customers a whole lot more closely.


How the Other Guy’s Accident Affects You Safety advocates often say one person’s accident is everyone’s accident—that we are all affected by the level of overall operational safety in our industry. And when it comes to insurance, that’s certainly true: each accident payout affects the premiums for other operators. “You can be the best, safest operator in the entire world


Why does your insurance cost so much, and what can you do about it?


“Te entire aviation insurance industry was losing money


hand over fist—15 to 20 cents on every dollar they collected. Tat wasn’t sustainable,” says Gardner. “We started seeing insurance rates rise dramatically in 2019, 2020, and 2021. Even so, I would say that the losses are still unacceptable. Over the past five years, the losses may be as much as $600 million to $700 million from just general aviation.” When a new underwriter entered the aviation insurance


market in the first quarter of 2022, many hoped the additional capacity and more competitive underwriting atmosphere might help lower rates. Gardner, however, doesn’t believe it will have much impact on rotorcraft operators. “I see the trend still moving toward higher rates. On top


of inflation, the cost of claims is going up and accidents aren’t going down appreciably, which puts pressure on the insurance companies. However, I don’t think we’ll see the 30% to 100% increases in premiums that we’ve seen over the last couple of years,” he says. “My average client right now is staring at a 10% to 20% increase, depending on the quality of their operation.” To the bottom-line question that every helicopter operator asks their aviation insurance broker, “Will my rates ever go


and yet your insurance rates are going up 10%. It’s because of all those other guys out there. If someone has one total loss, how many policies would the insurance company have to sell at the same premium to make up for that one total loss? It’s humbling,” says Gardner. Aviation insurance companies don’t share


details about how they calculate premiums, but other organizations do track and report accident information. Te US Helicopter Safety Team, the group of government and industry volunteers working to improve safety in US civil helicopter operations, examined 10 years of helicopter operations data from January 2009 through 2018. Te team found that while air ambulance helicopters flew


about 16% of the industry’s more than 31 million flight hours during that period, they accounted for only 7% of all rotorcraft accidents. Also ranking in the top three sectors for fewest accidents per share of flight hours were police/ news-gathering/aerial observation flights and air tour/ sightseeing flights. (See “Industry Sector Flight Hours versus Accident Share, 2009–2018,” on p. 36 for a complete breakdown by industry sector.) On the other hand, private pilots operating personal


helicopters accounted for a full 22% of accidents—a staggering number given they fly only 3% of all flight hours. However, these pilots typically face numerous challenges: they may be less experienced, and their operations often lack the safety infrastructure and layered decision-making of larger operations. Helicopter operators working in aerial application as well


as those supporting utility and construction operations also had higher rates of accidents than others because of the challenging environments they operate in, including flying in the obstacle-rich low-altitude airspace. “Helicopter operators fly lower and slower. Tey put the helicopter in a lot more hazardous positions than most


SEPTEMBER 2022 ROTOR 35


Insurance companies determine premiums based on “the ship you fly and what you do with it,” says James Gardner, a 14,000-hour ATP-rated pilot who now owns and manages an insurance brokerage firm.


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