GA and Insurance
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When people enter the contract, they agree to fulfill one part of the bargain like (a) maintaining their licence currency, (b) maintaining their medical currency (c) etc. In return, the insurance company agrees to maintain their side of the bargain in paying out in case of a loss. If one side doesn't keep their side of the bargain, why should the other?
Why are so many people here continually trying to find loopholes and wriggle out of minor points like OBEYING THE LAW???????
Why are so many people here continually trying to find loopholes and wriggle out of minor points like OBEYING THE LAW???????
- The law now requires us to carry a minimum level of third party insurance. This is so that the reasonable financial consequences of an error on our part can be insured (rather than being met from the estate of the pilot - whom if flying professionally is likely to have a minimal estate due to the current levels of pay in the industry).
- This seems like good public policy, we pay to insure the public against our actions.
- However, the more significant the damage to the public, the more likely the insurer is to dig for a reason not to pay - and these reasons need have nothing to do with the accident in question. In fact, read literally, these reasons are so numerous that many to most fatal accidents will have a non-compliance.
- So, not withstanding the public policy requirement to have third party liability insurance, there is a significant chance the injured parties will be facing an uninsured pilot
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Captain Stable
Just a very quick post for the moment .....
We know each other personally but it's an over-statement to say you have worked with me professionally. The possibility was discussed on one occasion several years, but no more than that.
If you keep going back to disagree with things people have said about the particular accident earlier, the thread will not move on into what could be a very interesting discussion - and one which could be very useful and informative for those who hold aviation insurance policies. Concentrating on the facts of one (apparently) extreme instance achieves nothing.
mm-flynn has raised very interesting public policy issues which merit further discussion.
It may be that others don't share the very 'black & white' views you've expressed in your most recent posts. I don't.
FL
Just a very quick post for the moment .....
We know each other personally but it's an over-statement to say you have worked with me professionally. The possibility was discussed on one occasion several years, but no more than that.
If you keep going back to disagree with things people have said about the particular accident earlier, the thread will not move on into what could be a very interesting discussion - and one which could be very useful and informative for those who hold aviation insurance policies. Concentrating on the facts of one (apparently) extreme instance achieves nothing.
mm-flynn has raised very interesting public policy issues which merit further discussion.
It may be that others don't share the very 'black & white' views you've expressed in your most recent posts. I don't.
FL
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mm-flynn has raised very interesting public policy issues which merit further discussion.
It may be that others don't share the very 'black & white' views you've expressed in your most recent posts. I don't.
It may be that others don't share the very 'black & white' views you've expressed in your most recent posts. I don't.
What is the answer? is it that pilots insist on third party NO FAULT payout clauses or that the law insists on this.
One question I would like to know is my own situation regarding my Ltd flying company and charging for commercial flying through that as a freelance pilot?
How secure is that and as one poster mentioned running an aircraft through a Ltd company for private use?
Pace
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I don't think it's an overstatement, FL.
If you recall, the solicitors briefing you sent me a large amount of reading, which took me a couple of weeks to plough through and on which I reported and we held a meeting at which I gave you and your learned brethren my opinion.
As to the matter of insurance, it could be that the insurance companies could be persuaded (but probably only by legislation) to go to some form of no-blame insurance in the manner of motor insurance.
The problem lies (or will quite possibly be found to lie) in how far one could go in such a matter as, say, an expired medical, which was one of the factors mentioned by the AAIB.
Take a hypothetical case.
Assume that a pilot in reasonably current practice, experienced in low-G undemanding aerobatics takes a couple of friends up and writes himself, his aircraft and his passengers off in an accident. It is subsequently found that his medical had expired.
Is his expired medical a reason for the insurance company to deny the claim?
Quite possibly not. It could well be a mere oversight, the medical had only expired by a few days, and the pilot was in perfect health.
On the other hand, possibly. Possibly the pilot had been having chest pains recently and was afraid of going to his AME to renew his medical for fear of what they might find. He hadn't mentioned it to anyone, and being "of an age" was planning on giving up flying to spend more time with his pruning and weeding. But he'd been in the pub with a couple of friends, and decided on another quick fun trip with his mates. He'd screwed up the entry to a manoeuvre, and the extra stress had his heart going just that little bit too much.
Who is to say where the truth might lie?
Lawyers could make a real killing out of cases like that!
If you recall, the solicitors briefing you sent me a large amount of reading, which took me a couple of weeks to plough through and on which I reported and we held a meeting at which I gave you and your learned brethren my opinion.
As to the matter of insurance, it could be that the insurance companies could be persuaded (but probably only by legislation) to go to some form of no-blame insurance in the manner of motor insurance.
The problem lies (or will quite possibly be found to lie) in how far one could go in such a matter as, say, an expired medical, which was one of the factors mentioned by the AAIB.
Take a hypothetical case.
Assume that a pilot in reasonably current practice, experienced in low-G undemanding aerobatics takes a couple of friends up and writes himself, his aircraft and his passengers off in an accident. It is subsequently found that his medical had expired.
Is his expired medical a reason for the insurance company to deny the claim?
Quite possibly not. It could well be a mere oversight, the medical had only expired by a few days, and the pilot was in perfect health.
On the other hand, possibly. Possibly the pilot had been having chest pains recently and was afraid of going to his AME to renew his medical for fear of what they might find. He hadn't mentioned it to anyone, and being "of an age" was planning on giving up flying to spend more time with his pruning and weeding. But he'd been in the pub with a couple of friends, and decided on another quick fun trip with his mates. He'd screwed up the entry to a manoeuvre, and the extra stress had his heart going just that little bit too much.
Who is to say where the truth might lie?
Lawyers could make a real killing out of cases like that!
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The aircraft one is the same if you are the owner and operator. However, if the owner(s) and the operator/pilot are different, then both groups are liable for the totality of any claims for damage on the ground (I don't remember about injury to passengers). So in the case of two people sharing - holding the aircraft in a ltd company should insulate the non-flying owner from the liability of the flying owner.
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- Circuit Break AD not complied with - Accident - VFR into IMC - Insurance pays out
- CB AD not complied with - Accident - Inflight fire - cause unclear - Insurance doesn't pay out as the CB AD could reasonably be material.
In CS's hypothetical case, there would normally be a post-mortem as part of the investigation which would either say - no evidence of pre-existing medical condition or medical blah blah ... might have contributed to loss of control.
As a general principle it seems like having tight conditions on the hull aspect makes good sense, I am less convinced of the merits of 'punishing' third parties for the errors of the pilot.
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The prospect of mcuh of so called insurance protection bieng invalid is insteresting / disturbing / worrying.
If the case come from FL then I'n obviously not in a position to argue - but I wonder where that leaves things in terms of the Unfair Contract Terms Act?
If a blanket clause is being used to avoid liability by the insurance company would it not be possible to challenge it under the terms of this act if the discrepancy is not causal in the accident.
Otherwise aircraft insurance is almost worthless - any multipart flight - out and back for instance would mean the logbooks would not be 'up to date' - unless they were filled in after every stop - a somewhat unusual practice....
If the case come from FL then I'n obviously not in a position to argue - but I wonder where that leaves things in terms of the Unfair Contract Terms Act?
If a blanket clause is being used to avoid liability by the insurance company would it not be possible to challenge it under the terms of this act if the discrepancy is not causal in the accident.
Otherwise aircraft insurance is almost worthless - any multipart flight - out and back for instance would mean the logbooks would not be 'up to date' - unless they were filled in after every stop - a somewhat unusual practice....
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MM
This is quite important because if true I was given dud information from my accountants. They naturally make charges for the accountancy work on the company.
My assets away from flying and the number of aircraft I was involved in caused me to seek an extra level of protection and a Ltd company was advised.
If there is no extra level of protection then the money spent has been a waste of time and err "Money".
Regarding third party payouts maybe the onus should be put on the insurance company to prove beyond reasonable doubt that the reason they are not paying was the reason the aircraft crashed.
ie in the case of NO valid medical that alone would not void the insurance. If it was proved that the pilot had a heart attack in the flight which caused or contributed to the crash and did not have a valid medical then they would have a case to not pay. etc ?
Pace
This is quite important because if true I was given dud information from my accountants. They naturally make charges for the accountancy work on the company.
My assets away from flying and the number of aircraft I was involved in caused me to seek an extra level of protection and a Ltd company was advised.
If there is no extra level of protection then the money spent has been a waste of time and err "Money".
Regarding third party payouts maybe the onus should be put on the insurance company to prove beyond reasonable doubt that the reason they are not paying was the reason the aircraft crashed.
ie in the case of NO valid medical that alone would not void the insurance. If it was proved that the pilot had a heart attack in the flight which caused or contributed to the crash and did not have a valid medical then they would have a case to not pay. etc ?
Pace
Last edited by Pace; 14th Oct 2009 at 12:21.
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Captain Stable
I do recall - it was the occasion I had in mind. After that meeting you had no further involvement in the ongoing case. (ie Your report was not used.) I really would prefer not to say any more.
FL
If you recall, the solicitors briefing you sent me a large amount of reading, which took me a couple of weeks to plough through and on which I reported and we held a meeting at which I gave you and your learned brethren my opinion.
FL
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I find it a bit worrying that the insurance company can choose not to pay out due to the clause that FL kindly pointed out.
My worry is that one does something inadvertently which breaches the ANO and has an accident (take the VFR into IMC scenario) - low houred pilot flies into IMC, loses control, gets into a spin, crashes, killing a couple of people. Now if I read what FL wrote correctly it seems that an insurance company *could* choose not to pay out, as the pilot was flying outside the privileges of his (her) licence....In other words, make a mistake and they won't pay out because you are in breach of the ANO.
I'd like to think that in the above example an insurance co. would pay out, because if not then it potentially exposes all of our estates to massive legal bills (and bankrupting those we leave behind) should me mess up in a similar manner. We shouldn't mess up of course, but that is another discussion.
My worry is that one does something inadvertently which breaches the ANO and has an accident (take the VFR into IMC scenario) - low houred pilot flies into IMC, loses control, gets into a spin, crashes, killing a couple of people. Now if I read what FL wrote correctly it seems that an insurance company *could* choose not to pay out, as the pilot was flying outside the privileges of his (her) licence....In other words, make a mistake and they won't pay out because you are in breach of the ANO.
I'd like to think that in the above example an insurance co. would pay out, because if not then it potentially exposes all of our estates to massive legal bills (and bankrupting those we leave behind) should me mess up in a similar manner. We shouldn't mess up of course, but that is another discussion.
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I'd like to think that in the above example an insurance co. would pay out, because if not then it potentially exposes all of our estates to massive legal bills (and bankrupting those we leave behind) should me mess up in a similar manner. We shouldn't mess up of course, but that is another discussion.
I am afraid we as pilots like other humans do mess up as you put it. Some more than others hence why insurance is there.
Messing up is not just the wings falling off your plane but off the pilot too.
This should be an area that is legislated on and not in the goodwill hands of an insurance company otherwise the insurance especially regards large claims is pretty pointless.
Pace
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Pace - I am 99% sure there is no feasible protection for your personal assets if you are the pilot when you prang it into the school / nursery / convent / football match [delete as appropriate].
There may be liability scenarios not related to you being at the controls, where a Ltd Co would be effective. One possibility might be a ferry flight on which the aircraft is lost, and the client sues for the aircraft value, and for some reason (unforeseen by you) your insurer walks away from paying. In that case, if the client contract is with a Ltd Co (which you own 100%, or whatever) the most he can do is force the Ltd Co into liquidation, and provided you have properly discharged your duties as a Director (which includes having "reasonable" insurance) you are not personally liable.
I don't know how this works in airline crashes, many of which - unlike GA where 3rd party damage is virtually unheard of - cause massive mayhem on the ground. I imagine that the airline insurance policy indemnifies the pilots. I would not want to be a commercial pilot otherwise... taxi into another 747 and lose your house!
Irrespective of this theoretical risk, is there any evidence of an insurer ever avoiding a payout in such a case? How would such an insurer know the actual flight conditions? This kind of concern reminds me of the "duty of care" stuff, which has caused such mayhem in all walks of life (schools not taking kids on trips, the whole yellow jacket brigade, etc) but 99% of which has never been tested.
There may be liability scenarios not related to you being at the controls, where a Ltd Co would be effective. One possibility might be a ferry flight on which the aircraft is lost, and the client sues for the aircraft value, and for some reason (unforeseen by you) your insurer walks away from paying. In that case, if the client contract is with a Ltd Co (which you own 100%, or whatever) the most he can do is force the Ltd Co into liquidation, and provided you have properly discharged your duties as a Director (which includes having "reasonable" insurance) you are not personally liable.
I don't know how this works in airline crashes, many of which - unlike GA where 3rd party damage is virtually unheard of - cause massive mayhem on the ground. I imagine that the airline insurance policy indemnifies the pilots. I would not want to be a commercial pilot otherwise... taxi into another 747 and lose your house!
low houred pilot flies into IMC, loses control, gets into a spin, crashes, killing a couple of people. Now if I read what FL wrote correctly it seems that an insurance company *could* choose not to pay out, as the pilot was flying outside the privileges of his (her) licence....In other words, make a mistake and they won't pay out because you are in breach of the ANO.
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The lack of examples may be more to due with us not knowing how to find them rather than the examples not existing - but it is still surprising given the number of accidents in which some administrative anomaly is commented upon (and dismissed from relevance by the AAIB)
A note to Mods - I think this insurance aspect is a very important conversation and not really related to the Failed Stunt title of the thread - should the thread be split?
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There are several recent fatal accidents where the flight conditions where unambiguously IMC at the point of the crash
1) that the pilot's flight conditions were IMC, and
2) that the pilot had a choice
Insurance does cover negligence, fortunately
I want to see actual cases of where insurance was voided on the basis of alleged illegal flight conditions, or indeed on the basis of anything at all taking place after departure.
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Insurance
Read your policy and (as appears to be the case on many people) you don't understand then ask your insurance company the question. The AAIB report doesn't lay blame, purely reports on the facts of the matter. Flyng lawyer is correct if you read his comments correctly! Someone said, oh if I didn't renew my medical until after expiry and had an accident in the meantime surely the insurance company should still pay because I am a great guy, then be disappointed. Mr Policeman I am going to renew my insurance when I get round to it - explain to the Judge! In all my years of buying of insurance for several different risks I have never seen the 'sorry I forgot clause' or 'insurance company will pay anyway'. Keep up your poor work pprune - ers.
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Insurance: Get your house in order
looking back over the last year I can identify several fatal accidents where the insurers will not be paying out.
Pilots flying beyond their skills in bad weather/ overloaded, paperwork/licences out of date/ flying for commercial sorties/etc.
There seems to be a perception in flying that insurance is some sort of old fashioned benevolent charity.
If you take someone to their grave then your family can lose everything.
Any thoughts?
Pilots flying beyond their skills in bad weather/ overloaded, paperwork/licences out of date/ flying for commercial sorties/etc.
There seems to be a perception in flying that insurance is some sort of old fashioned benevolent charity.
If you take someone to their grave then your family can lose everything.
Any thoughts?
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Yeah, why would my family be held responsible for my fatal error?
I would expect that any payments would have first come out of my final will and testament, so my dependants probably wouldn't receive their inheritance. But is that as far as it goes, or are they deemed responsible for my debts as well through no fault of their own?
I would expect that any payments would have first come out of my final will and testament, so my dependants probably wouldn't receive their inheritance. But is that as far as it goes, or are they deemed responsible for my debts as well through no fault of their own?
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SpeeedBird,
Interesting point, but for retail insurance (which I am sure you do buy) the compliance requirements are much less onerous. If you drive with an expired MOT or less than minimum tyre tread (illegal of course and subject to a small administrative penalty) it does not totally void your third party liability cover. In addition, my understanding of the law (limited as it may be) is that these types of very broad conditions are generally not enforceable in common end consumer contracts.
I will try and keep up the poor work and remain bemused as ever that EASA have imposed an insurance requirement to pay-out for damage to people and things on the ground, the CAA spends money writing to everyone to verify compliance and then on the day the third party needs to call on it - effectively the insurance is void! Great public policy.
PS -
It seems desperately unreasonable in one case FL referred that what appears to be a highly conscientious pilot with a full set of ratings from two countries - both current, with exemplary training, excellent aircraft, current medical, can have his family bankrupted and the lives of people he injured/killed only partially compensated due to his failure to renew a based on CoE - which probably was only relevant due to the flight being outside the UK. Yes, I know the operation was therefore not legal, but it does seem an extraordinary penalty on the family and the injured parties.
Note - I have no idea what third party liability might have existed in the specific case FL quoted.
Interesting point, but for retail insurance (which I am sure you do buy) the compliance requirements are much less onerous. If you drive with an expired MOT or less than minimum tyre tread (illegal of course and subject to a small administrative penalty) it does not totally void your third party liability cover. In addition, my understanding of the law (limited as it may be) is that these types of very broad conditions are generally not enforceable in common end consumer contracts.
I will try and keep up the poor work and remain bemused as ever that EASA have imposed an insurance requirement to pay-out for damage to people and things on the ground, the CAA spends money writing to everyone to verify compliance and then on the day the third party needs to call on it - effectively the insurance is void! Great public policy.
PS -
It seems desperately unreasonable in one case FL referred that what appears to be a highly conscientious pilot with a full set of ratings from two countries - both current, with exemplary training, excellent aircraft, current medical, can have his family bankrupted and the lives of people he injured/killed only partially compensated due to his failure to renew a based on CoE - which probably was only relevant due to the flight being outside the UK. Yes, I know the operation was therefore not legal, but it does seem an extraordinary penalty on the family and the injured parties.
Note - I have no idea what third party liability might have existed in the specific case FL quoted.
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Originally Posted by The Heff
I would expect that any payments would have first come out of my final will and testament, so my dependants probably wouldn't receive their inheritance.
