What to Look for When Getting Pilot Insurance

There was a time when virtually every insurance company would discriminate against you if you are a pilot applying for insurance coverage. They would either treat you like a smoker and require you to pay higher premiums, or your life insurance contract will exclude general aviation so that if your death is related to your flying they won’t have to worry about your insurance claims.

Nowadays there are smarter insurance companies who have realized that pilots are actually “excellent risks” for life insurance. Pilots in general have better education and higher income, and they generally undergo health exams twice a year. So as a pilot, you may be able to get a much better deal on your insurance.

Here’s what you need to look for:

  1. Your insurance should be sufficient for your situation—no more, no less. Get the insurance cover you need, and don’t buy those that you don’t really require. The insurance needs of a man with a wife and several school-age kids are different, as you have to leave something to provide for them and for the children’s future education. But if you are single and you don’t have kids, it would be enough to have something to cover the funeral expenses and perhaps a little something for your parents and siblings.

  2. Consider lower premiums. Higher insurance costs for pilots mean that the insurance company thinks that your flying is as dangerous to your health as smoking cigarettes. You will then be rated, and the cost increase can be anywhere from 50% to double of what you should pay. Instead of going for this, look for a company who seems to understand how aviation has become safer now and which will offer preferred (lower) life insurance rates.

  3. Look for an insurance broker who’s also a pilot. Explaining pilot issues to insurance agents who don’t know anything about flying is tough and often unsuccessful. It’s better to work with a broker who’s already familiar with your profession. These pilot-brokers will know which insurance companies discriminate against pilots, and they can also work for you so that you can get better coverage or lower premiums.

  4. If you have a term insurance policy, check out current rates. In the last few years the rates offered by insurance companies have dropped considerably. If your policy is only three to four years old, significant savings may be in store for you despite the fact that you’re now older.

  5. If you are buying term insurance, look for a guaranteed renewable insurance policy. It may also be called convertible term insurance, conversion privilege, or guaranteed insurability. This policy has an agreement that requires the insurance company to renew the policy for a specific time period regardless of the state of your health, as long as you pay your premiums on time. However, the insurance company may likely raise your premiums.

  6. Take advantage of any insurance plan sponsored by your employer. There are too many benefits to this, so you simply can’t forego it. But as a pilot, make sure to check for exclusions that will involve your flying.

After taking all of the above into consideration, make sure you review and understand your policy. Have a clear idea of the terms, the face amount, and the premium. With a reputable broker, you may be able to compare different options more effectively.

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