Aircraft Insurance for International Operators

Aircraft insurance is essential for protecting your investment and is required by virtually all lenders. For international operators, insurance considerations include finding insurers experienced with international risks, ensuring coverage for intended operating areas, and proper policy structuring for trust arrangements.

The main types of aircraft insurance are hull coverage (physical damage to the aircraft), liability coverage (damage to third parties and passengers), and various optional coverages.

Hull insurance covers physical damage to the aircraft. Coverage is typically written on an "all risks" basis with certain exclusions. The policy limit is usually the aircraft's agreed or market value.

Key considerations include whether coverage is on an agreed value or actual cash value basis (agreed value is preferred), deductible amounts for different types of operations, and coverage for equipment and modifications.

For financed aircraft, lenders require hull coverage at least equal to the loan amount with the lender named as loss payee.

Liability coverage protects against claims from third parties for bodily injury or property damage. Coverage limits should reflect realistic exposure based on aircraft use and passenger capacity.

For business aviation, combined single limits of $50-100 million are common. Higher limits are available and may be appropriate depending on passenger profiles and operating environment.

Liability policies should cover both domestic and international operations. Review policy territory clauses to ensure coverage extends to all intended operating areas.

Operating internationally introduces additional insurance considerations. Some countries require local insurance policies or minimum coverage amounts. War risk and terrorism coverage may be needed for certain destinations.

Ensure your policy provides worldwide coverage or specifically lists all countries where you intend to operate. Some insurers exclude or limit coverage in certain regions.

Aviation war risk insurance is typically written separately and covers losses from war, terrorism, hijacking, and related perils. Coverage terms and availability can change rapidly based on global events.

When aircraft are held in trust, insurance policies must properly name all relevant parties. This typically includes the trustee as legal owner, the beneficiary as operator, any management company, and lenders as additional insureds or loss payees.

Work with aviation insurance brokers experienced with trust structures to ensure policies are properly written. Incorrect policy structure could leave gaps in coverage.

Aviation insurance is a specialized field. Work with brokers who focus on aviation and have experience with international owners. They can access markets, explain coverage options, and advocate on your behalf.

Provide accurate information about your flying experience, intended use, and operating areas. Material misrepresentations can void coverage when you need it most.