5 Tips to Optimise Your Aircraft Insurance and Reduce Your Premiums
Choosing the right aircraft insurance isn’t just about being fully protected—it’s also about avoiding unnecessary costs. Whether you’re a private owner, part of a syndicate, or flying commercially, understanding how your policy works can help you save money without compromising on cover.
Below are five practical tips to help you optimise your aircraft insurance:
1. Choose the Right Pilot Cover
One of the primary factors influencing your insurance premium is who will be flying the aircraft. Insurers offer two main options:
a) Named Pilots
This allows you to specify the details (names, licence, experience, insurance history etc) of pilots to be covered. Adding less experienced pilots will tend to raise your premium, while discounts apply if the number of named pilots is kept down. This option is often best if you wish to restrict flying to a small number of known individuals.
b) Open Pilot
If there are many pilots who fly the aircraft, or if you do not know who they will be, the ‘Open Pilot’ option is available. This allows you to specify criteria (e.g. maximum age, minimum hours, licence type etc) that you would require a pilot to have before you would allow them to fly. Specifying stricter criteria (e.g. requiring more hours) will help reduce the premium, although the Open Pilot option will generally cost more than restricting cover to named pilots only.
You can combine these options, using open pilot to cover most flyers but then naming any pilot who does not meet the open pilot criteria.
Provision is also made in the policy for other pilots who may be required to fly the aircraft (e.g. instructors providing instruction, examiners etc). Please consult your policy booklet for full details.
2. Select the Right Aircraft Use Options
Aircraft can be used for a wide variety of purposes, from pure private and pleasure flights, through aerobatics and display, to commercial activities such as hire and reward. It is important to make sure that your aircraft insurance policy fully reflects what you will be using the aircraft for, on the one hand to ensure that you a properly covered, while on the other to avoid paying for cover you do not need.
3. Set the Right Value For Your Aircraft
Most aircraft insurance policies are based on an Agreed Value, meaning the amount you specify is the maximum that might be paid out in the event of a total loss. Choose a figure that reflects the current market value, inclusive of all installed equipment. It is important to make sure this figure is as accurate as possible:
- Undervaluation: This may mean relatively minor damage may result in a constructive total loss of the aircraft, with rights to its salvage value passing to the insurer
- Overvaluation: This means you’ll probably pay more than your need
A good starting point when deciding on a value is to search online for the same or similar make and model of aircraft for sale, ideally of a similar age and with comperable equipment. You may also wish to consider including other costs you might incur in seeking a replacement, such as engineering inspections of a prospective purchase.
4. Choose Your Level of Liability Cover Carefully
Aircraft owners / operators are required to have at least a minimum level of insurance cover for up to four different types of liability exposure. Third party and passenger liability risks will apply to most aircraft, while baggage and cargo liability risks can also apply to those operated commercially.
Rather than arranging separate amounts of cover for each risk, owners can select a Combined Single Limit (CSL) as a single value to encompass them all. As well as being simpler to arrange, a CSL provides more flexibility in paying liability claims, especially if passengers are injured, but little damage is done to third party property on the ground.
The minimum requirement is determined by the aircraft’s maximum take-off weight, number of passenger seats and whether it is used for a commercial purpose. Insurers should ensure you do not arrange cover below this minimum, but you should still check the requirement by visiting the CAA Website, entering your registration in search, then scrolling down and clicking 'Minimum Insurance Requirements'.
IMPORTANT – You should consider purchasing a higher level of cover than the minimums as these do not necessarily reflect the real-world risk. For example, imagine an owner who arranged a CSL of £3.5 million as this was the legal minimum required for their aircraft. If they are subsequently responsible for an accident in which the courts award damages of £4.5 million, the policy will pay out the CSL of £3.5 million but the owner would still be liable to pay the uninsured £1 million, possibly requiring the sale of assets.
5. What If Your Requirements Change Over The Year?
No matter how much consideration you give at the outset to who will fly the aircraft, what you will use it for or what level of cover you need, we all know that your requirements can change in the year. You may get a new syndicate member, you may no longer need cover to train a student, or you may have an avionics upgrade which increases your aircraft’s value.
The good news is that aircraft insurance from Visicover is flexible, so you can update most elements of your cover online as your needs change. Simply log in, open your policy, request a cover change and then enter details of the required amendments, along with the date from which you would like the changes to apply. We will normally give you an instant indication of the impact of the change on your premium for the rest of the year, either up or down. You can then confirm the change, at which point your aircraft insurance policy cover will be updated.
Final Thoughts
Optimising your aircraft insurance doesn’t have to be complicated. By choosing appropriate pilot cover, setting the right aircraft uses and value, understanding your liability needs, and updating your policy as circumstances change, you can stay properly insured while keeping your premiums under control.
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