How To Reduce Aircraft Insurance Costs


How To Reduce Aircraft Insurance Costs

Reduce Insurance

Reducing Aircraft Insurance

If you are reading this you are probably in the market for aircraft insurance. Do you currently have aircraft insurance and are looking for ways to make it cheaper?

As you know aircraft insurance is not required on a federal or state level. However, if you are being a wise pilot it’s always important to have aircraft insurance in the case of an emergency or incident. You may have recently requested a quote on aircraft insurance and been surprised by the cost.

In this article we will go over:

  • Go over what goes into calculating your aircraft insurance.
  • Whether or not you need aircraft insurance.
  • The Overall cost of aircraft insurance.

What goes into the cost of aircraft insurance?

There are a lot of things that go into aircraft insurance. A few factors that determine your aircraft insurance cost/premiums are:

Your total amount of hours

There is only one real metric insurance providers can use to determine your experience, your hours. Going into aircraft insurance policies with more hours will almost always benefit you in the long term as it generally leads to more appealing rates. However, if you have a lot of hours but little to no time in the aircraft of your choice, this can be detrimental as well. So, ensure that the aircraft you choose lines up with your experience, whether that’s type or model. This way you will be more likely to qualify for fire discounts on your aircraft insurance.

Hours in your aircraft model or type

The aircraft you choose is very important in determining your aircraft insurance rate. Just like cars, an insurance provider has to run statistics on the aircraft type to determine its reliability, difficulty, and incident history. In addition, your time in the aircraft of your choice determines your experience level dealing with that type of aircraft. This is why most aviators elect to get a Cessna or a Piper, aircraft that they have previously trained with. The more logbook hours in the aircraft of your choosing, the better.

Aircraft Storage: Whether or not your aircraft is hangared

Here is one that most people don’t expect, your aircraft storage. It makes sense, if your aircraft is hangared then it is more than likely protected from the elements. Birds and bees may end up in the intakes; winds, branches that may hit your aircraft while stationary on the ground. Depending on your location, keeping your aircraft in a hanger may be a really cheap avenue but will save you in the long run when it comes to insurance. In addition, keeping your aircraft hangared almost guarantees that your aircraft will be in tiptop shape when you return to fly again.

How much does Hangar storage cost?

Hanger insurance cost varies based on a variety of factors, not all hangars are the same. Private hangers often cost the most coming in at around $250 – $500/month

Shared hangars are a different story and can usually change based on the demand, area, square footage of your aircraft, and other factors. The larger the aircraft, the more you will have to pay. Local airports with smaller space often increase prices to around $1000/month.

Your FAA Medical Status

Has your FAA medical ever been revoked or had to go under review? This factor can play a big role in your insurance costs. Not as dependent as the other factors however, depending on any history in the past insurance premiums can increase. Make sure to keep your FAA medical record clean if possible, to ensure a chance of reduced rates.

Your current FAA ratings

Earning additional pilot ratings can decrease your aviation insurance tremendously. Earning your instrument license indicates to insurance that you are a more experienced aviator. Having this rating will enable you to fly in more locations and get out of bad weather with ease. An instrument license can be a sure way to reduce aviation insurance costs and keep you safer. If you have all the way up to your ATP license you will qualify for more benefits when it comes to aircraft insurance. Bottom line, generally speaking, the more ratings you have, the easier it is to reduce your aircraft insurance cost. Check with your insurance company first to see if they have any specific requirements on this matter.

Frequency of pilot proficiency efforts

When was your last biennial flight review? Or even better yet, when was the last time you went up with a flight instructor? It’s important to show evidence that you are routinely seeking an audit of your flight skills. This can go a long way in proving to an aircraft insurance provider that you are a responsible pilot who takes your experience into your own hands. Ensure that you are working to increase your proficiency with assets like the FAA wings program or flight school refresher courses that keep you in touch with your aircraft.

Click here to access the FAA Wings Program

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Your FAA flying record

Have you ever had an incident with the FAA? Your License revoked or suspended? Issues like these may play a huge determining factor in your aircraft insurance costs. This is why it is important to maintain a clean flying record with the FAA. With a lot of incidences, an insurance provider may have reason to believe you are not a safe pilot. Work with your insurance provider to see what their policies are regarding aviation records.

Do you need aircraft insurance?

No, you do not need aircraft insurance. There is no federal or state law requiring individuals to use aircraft insurance for their aircraft. However, it is highly advised since flying is a very risky operation by nature. Having the proper insurance gives you the peace of mind to operate your aircraft. Aircraft parts can be very expensive and will amount faster than most people think. It is important to be prepared in all scenarios.

Do I need aircraft Renters insurance?

No, Renters insurance is meant to cover any liabilities incurred from claims while renting a third-party aircraft. As long as you have the required number of hours and checked out in the aircraft type, you should qualify under this type of insurance. Renters insurance is not required to rent an aircraft however it is highly suggested. Rented aircraft are not in the same condition like most other newer or owned aircraft. This is why it is important to have insurance on rented aircraft as they may have underlying problems.

Check out our suggestions on buying versus renting an aircraft. Depending on your scenario – Buying an aircraft may be cheaper in the long run.

How much does Aircraft Insurance cost?

In addition, the more complex an aircraft is, the higher the insurance may be. Small aircraft insurance runs about $1,000 to $2,000 per year but can go much higher depending on the value of your aircraft.

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The Bottom Line

Just like a car, your aircraft insurance truly depends on your status. Before going to an aircraft insurance provider make sure you have proof of your FAA records, log book hours, and FAA ratings. This way you can provide proof that you are a safe pilot. All of the above has been discussed so that you can be prepared when going to an Aircraft Insurance company with maximum preparedness.

If you are interested in learning more about your aircraft insurance options, check out our blog article on all things Aviation Insurance here!


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