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| Minimizing helicopter insurance costs: |
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This month’s article is geared
toward Law Enforcement/Government municipalities using helicopters
for their airborne law enforcement and what can be done to minimize
costs. One of the most significant recurring costs for Law
enforcement agencies is the cost of insuring their helicopter of
fleet of helicopters.
I have seen fiscal reports and discussed with agency officials the
options available for reducing costs. One avenue that some have
opted for is to “time-share” the helicopter with other agencies,
perhaps a neighboring municipality or another government entity.
This does have its benefits and helps reduce costs for smaller
municipalities or divisions of law enforcement; however, for some or
many, this may not be an option.
As with all aviation insurance, a good agent is your best bet in securing a good quote. Ask about their experience with this unique form of flight; their relationships with helicopter underwriters can make a difference in the premium you are quoted. An Agency that specializes in helicopter insurance, that stays current with the latest operational issues, through day to day dealings with the operators of the equipment, and maintains currency through professional memberships and affiliations is the agency best outfitted to work with you to provide opportunities to reduce premium and improve coverage.
It’s also not just the agency but the
individual producer and his staff/assistants that need to develop an
intimate working relationship with you. You need to be able to reach
them anywhere, anytime and the right hand (within the insurance
agency) needs to know what the left hand is doing. A cohesive unit
facilitates the best results. Your agent and the agency they
represent need to have a good reputation with the underwriting
companies and they need to have a good work ethic, knowledge and
expertise to handle and understand your needs. On top of what I have
just mentioned – you need to like and trust this individual or group
of individuals.
So what will a good agent to do help you lower your premiums? If you
are operating a helicopter fleet, a meeting with your agent and the
underwriter at your location can help them understand your needs and
allow them to see your commitment to safety.
Always use a licensed agent and an “admitted” insurance carrier. A
popular “non-admitted” manufacturer’s program automatically
depreciates the aircraft’s value as it accumulates hours.
“Admitted: An insurer that meets the licensing criteria of the state
it wishes to do business in and has received a certificate of
authority. Also known as an authorized company.”
“Non-Admitted: An insurance company that is not licenses to write
business in a particular state. Also known as a surplus, excess or
excess and surplus lines (E&S) company.”
This program also requires that you pay the expenses to recover the
downed aircraft and return the helicopter to the factory for repair
and it requires that you share any liability insurance you buy with
the manufacturer. Sure, you will pay a smaller premium; however, you
stand the chance of incurring thousands of dollars in other costs in
the unfortunate event of a claim. These relocation and transport
expenses coupled with the automatically-reduced hull value and
halving of your liability coverage can be a huge burden. It is
important to understand all the policy terms and conditions; the
last thing anyone wants is a surprise when they need their insurance
company the most. The “bargain” insurance company is enticing up
front but when you need them the most and the coverage isn’t there
that you need – you will have blown through budget and then some.
Often times it’s not a matter of “if” you need your insurance
company it’s a matter of “when”.
Yes – the admitted company will probably cost more money, but the
coverage that you will have is worth the peace of mind and will be
well worth it should you need to use your insurance.
There are several excellent programs for specific helicopter
manufacturers, including the Robinson Program (through Sutton
James/Starr Aviation), the Bell/Eurocopter Program (through USAIG)
and the Schweitzer program (through W. Brown). These programs are
available for airborne law enforcement, municipal and governmental
operations as well. Your insurance agent will know if these programs
are available for your specific form of flight and how to access
them.
While a good working relationship with a competent and qualified
agent can significantly help you to lower your insurance costs, keep
in mind that the number of helicopters flying is small compared to
the number of fixed wing aircraft out there in the skies. Insurance
companies base their rates on statistics and the more statistics
they have the more favorable the rates can be. Another point to keep
in mind is that helicopters rarely have minor damage (dings, hangar
rash, etc) when a helicopter has an incident or accident the result
is usually more catastrophic. This is reason for the underwriters to
have to implement higher rates. Having a good safety supervisor on
staff that can work with your insurance company towards developing a
sound and safe environment from hangaring of the aircraft to the
training of the pilots and the in-flight use of the helicopter can
and will go a long way towards making your operation more successful
and more cost efficient.
Lastly – I’d like to make a point to law enforcement
agencies/municipalities regarding your “pilots”. If you haven’t
already – you should review your workers comp policy with your
current agent and make sure there is not an exclusion for
“aviation-related accidents”. If this is the case – your pilots may
not be covered under your present workers comp policy and you may
need to seek out a separate policy for them. Many aviation insurance
companies today, if they are insuring your aircraft for you, are
also able to provide a workers comp policy for your pilots.
If you have any questions, please be sure to direct them to your
insurance agent, maintain an open line of communication with that
person and use them to help you learn and understand the terms of
your policy.
Karla Lehman, started flying in 1988, is a graduate of the
University of North Dakota’s Center for Aerospace Sciences, is a
licensed Commercial and Instrument pilot as well as a licensed
Insurance agent for Leading Edge Insurance Agency, Inc. |
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| These articles are purely advisory in nature. Your own certificated flight instructor, the FARs, pilot's operating handbook and various updated transmittals from the FAA or your aircraft manufacturer may alter or affect the information published. Leading Edge Aviation Insurance neither assumes any responsibility for the accuracy of these articles, nor any liability arising out of reliance upon these articles. |
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