Kyle White
Aviation Practice Leader
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Summary
Private pilots, aircraft owners, and other general aviation enthusiasts face a variety of personal and liability risks.
Understanding your risks and the different insurance coverages could help protect you, your family, your passengers, your aircraft, and your assets.
Work with a personal risk advisor familiar with general aviation insurance and regulations to help ensure you have appropriate precautions in place.
Pan-pan. This is P-Baron N12345. I’m experiencing pressurization problems and declaring an emergency. I have four souls on board. I’m currently at 14,700 feet and descending 3,000 feet per minute. I’m approximately 10 miles north of Mount Air. Please advise on the nearest safe landing area. Over.
“Pan-pan” is a call pilots use when a situation is urgent but not a full emergency, similar to “Mayday.” It’s not a call any pilot, aircraft owner, or general aviation enthusiast wants to hear or say. Pilots train for these rare crisis scenarios to respond appropriately.
While such emergencies are infrequent, they occur more often in private and general aviation than some may expect. The common saying that you’re more likely to have an accident driving to the airport than flying at 38,000 feet may not fully reflect current data. According to the AOPA Air Safety Institute:
- Non-commercial single-engine aircraft accounted for more than 76% of accidents in 2024.
- Multiengine planes were involved in 8.1% of accidents that same year.
- Personal use of fixed-wing aircraft resulted in 71.1% of non-commercial accidents in 2024, compared with 2.5% in business flight operations.
Despite these risks, demand for private aircraft is on the rise. New private jet deliveries increased from 2023 to 2024, and many high-net-worth individuals and families are considering investing in their own private aircraft, either through purchase or lease.
Sitting in the captain’s seat means more than enjoying the view; it involves real risks, including potential lawsuits related to safe flying, passenger injuries, property damage, or aircraft maintenance issues.
By reviewing your personal aviation liability and insurance coverage, adhering to best practices for pre-flight checks, and scheduling regular risk reviews, you will be better able to manage your risks and increase your confidence while flying.
Pre-Flight Insurance Checklist
1. Understand the personal aviation liability "headwinds"
Before you start your takeoff roll, consider the risks you could face in the air, on the ground, and with your passengers.
Negligence claims.
If an accident happens due to the pilot’s failure to follow safety protocols, properly maintain the aircraft, or ensure adequate training, the pilot could be held liable for damages. These damages may include injuries to passengers, property damage, and fatalities. Aircraft owners also face liability exposures, such as failing to hire trained, licensed, and experienced pilots. Passengers may seek compensation for medical expenses, lost wages, and pain and suffering related to injuries.
Friends' Turbulet Weekend Getaway
A private passenger jet piloted by its owner and four friends encountered severe weather, resulting in several injuries during turbulence.
The plane landed safely, but one passenger who was seriously injured sued the pilot-owner for medical expenses, lost wages, pain + suffering, and litigation costs.
Thankfully, the pilot's liability insurance covered the $5 million settlement.
Compliance with FAA and other regulations.
Private aircraft owners are required to comply with the Federal Aviation Administration (FAA) and other relevant regulatory bodies. Failure to do so may result in fines, penalties, and increased liability risks. For example, operating an aircraft without the necessary pilot certifications and licenses could have legal consequences, which typically aren’t covered by a hull and liability policy.
Environmental liability.
Your aircraft could pose environmental risks, including fuel spills and emissions. Cleanup costs or legal actions could be significant. Pollution is generally excluded from aircraft policies unless it is directly caused by an “occurrence.” A separate pollution policy should be considered.
Third-party liability.
If an accident affects individuals or property outside the aircraft or on the ground, both the pilot and the aircraft owner could be held liable for damages.
Parking Lot Accidents Happen to Aircrafts, Too!
The owner of a small turboprop plane was taxiing to the main runway of a local airport when the plane's wing accidentally clipped a parked plane, shearing off the other pane's rudder.
Damage to both planes was estimated at $1.9 million.
The owner had Aircraft Hull and Liability Insurance, which covered the repair costs for both aircrafts after the deductibles were met.
2. Secure “tailwinds” with appropriate insurance coverages
Unlike auto insurance, which is required for drivers in nearly every state, there are no federal or state regulations mandating that pilots carry aircraft insurance. However, renting an aircraft or using facilities at specific airports, including Fixed Base Operators (FBOs) or international airports, often requires insurance. Whether you own, rent, or lease, having the right coverage helps protect you, your aircraft, your passengers, and your finances. Key coverages include:
Liability insurance protects pilots and aircraft owners from legal claims resulting from bodily injury or property damage caused by accidents or other aircraft-related incidents.
Hull insurance protects your aircraft against damage related to accidents, vandalism, theft, and natural disasters. Be sure to consider “war hull” coverage, which covers damage due to strikes, riots, civil commotions, or government seizures.
Non-owned aircraft insurance is for pilots who rent or borrow aircraft and provides liability and sometimes hull coverage. Be aware of potential coverage gaps if you’re dry leasing an aircraft.
Hangar insurance protects against damage to the space you own or lease, such as a hangar and its contents. Sometimes this can be added to your aircraft hull and liability policy.
Premiums may vary based on aircraft type, value, and usage, as well as pilot experience and age, coverage limits and deductible amounts. Review policy details, limits, and exclusions carefully to ensure you understand them fully. Here are some tips to consider based on your aviation status: owner-pilots, non-owners or fractional owners of aircraft, or those who hire professional pilots.
Owner-pilots
- Has your airport or FBO contract been reviewed and approved by your insurance company?
- How did you screen your maintenance provider, and did you get a certificate of insurance to ensure you have the right coverage with appropriate limits?
- Do you have a relationship with your broker and their underwriter? As the owner-pilot ages, they need to be more than just a piece of paper to the underwriters. Consider meeting over Zoom or in person at aviation conferences.
Non-owner or fractional owner of aircraft
- Do you dry-lease aircraft? Have you had that lease reviewed by your insurance broker and received a corresponding certificate of insurance that extends coverage to you, the lessee?
- What steps are you taking to ensure the pilots meet your standards and industry standards for qualifications and training? FAA compliance is the baseline, but it doesn’t guarantee insurance or pilot warranty compliance.
- If you own a fraction of the plane, did you know you also own a fraction of the insurance coverage? A “MAX” policy is a relatively simple and low-cost option that provides 100% coverage for your 1/16th share of the aircraft.
Jet or a turboprop aircraft owner who hires professional pilots (a.k.a. "industrial aid")
- Does your insurance program provide ancillary coverages to keep you flying when your aircraft is on the ground (AOG) during a covered claim?
- FBOs and other aviation businesses may shift their risk and negligence to you through contractual requirements. Have you reviewed these with your broker to manage your risk and avoid assuming liabilities you shouldn’t?
- Do you use contract pilots or lease your aircraft to others? You have significant exposure, and managing this risk through contracts and insurance structuring is critical. If not approved by your insurance carrier, coverage could be denied.
3. Continuously run pre-flight checks using best practices
Pilots, aircraft owners, and renters of private aircraft could reduce their risks in personal aviation by following these best practices:
Stay compliant.
While the FAA sets and enforces specific pilot standards, it doesn’t require or implement insurance. A pilot’s license, medical certificate, and other necessary documents must be up to date. If any of these requirements aren’t met, there could be legal consequences if you or the pilot you hire are involved in an accident or other incident.
Maintain pilot qualifications.
Loss of control in flight and on the ground are among the most common causes of accidents in private aviation. Aircraft owners, whether they hire another licensed pilot or fly their own planes, should ensure pilots have appropriate ratings and experience for the type of aircraft and intended operation. Being a “current pilot” based on FAA requirements doesn’t necessarily mean being a “proficient pilot.”
Inspect and conduct regular maintenance.
System component failures are among the 10 most common causes of aviation accidents. Older aircraft and those with inconsistent maintenance are more likely to experience system problems that may affect the safety of those aboard. Consider an active preventive maintenance strategy to avoid costly, unexpected maintenance events.
4. Engage with "top gun" personal aviation risk specialists
Navigating personal aviation risks is smoother with guidance. Our in-house aviation division, comprising nearly 50 colleagues who specialize in aviation placements, includes former professional pilots, underwriters, claims adjusters, and active aircraft owners. We offer specialized programs, such as MACH—our aviation insurance and risk management solution—and dedicated claims support specialists.
Ready to fly safer? Request a personal aviation risk review and take control of your aviation journey.
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