What is the legal framework for aircraft insurance?
In Florida, the legal framework for aircraft insurance is governed by the Federal Aviation Administration (FAA). The FAA lays out specific standards for aviation insurance, which must be obtained in order to legally fly a plane. The minimum levels of coverage are divided into two parts: hull coverage and liability coverage. Hull coverage covers the aircraft’s physical damage as well as any personal possessions contained within the plane. Liability coverage is more complex. It covers any damages or injuries that may occur as a result of an aircraft accident and typically includes coverage for bodily injury, property damage, and passenger liability. When applying for aircraft insurance, some factors that must be taken into consideration include the type of aircraft and its intended use, the flight hours, and the experience of the pilot. Furthermore, the policyholder must consider what kind of risk they are willing to take. Insurance companies may offer discounted rates for older aircraft models or those with an excellent safety record. Lastly, the FAA requires all aircraft insurance policies to include a waiver of subrogation, which waives the insurance company’s right to be compensated for coverage from a third party for damages that occurred as a result of an accident.
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