I don’t pretend to know much about insuring an aircraft for private business and pleasure purposes. As pilots, we all go through the process of buying insurance on an annual basis. There are many choices to be made, most of them we don’t totally understand. We rely on advertising by the insurance companies, the recommendations of other pilots, and the endorsements of various pilot organizations such as COPA, AOPA and EAA. In my opinion, aircraft insurance is far too serious to be casually approached.

Many pilots insure to the absolute minimum requirements, which is the liability amounts that Transport Canada requires. They don’t buy the hull or even the not-in-motion coverage and often don’t carry coverage for their passengers. Luckily, there are relatively few stories of tragic losses that were not insured. But they do happen!

I have been the sole owner of airplanes and have been in partnerships. Quite frankly, I never gave insurance much thought when it was time to buy or renew. It seemed pretty simple to do it all on the phone, and be instantly insured, ready to fly that same day with the policy receipt sent via e-mail. Too easy! When flying commercially, the whole process is handled by the company, so working pilots don’t have much to do with those arrangements.

All this insurance business has been fine with me until an incident during the summer of 2014 required that I file a damage claim on a borrowed aircraft. It was a process that eventually ended positively, but it was stressful and a definite learning experience. There’s a flawed suspicion the public has that insurance companies are unethical and will find ways to get out of their obligation to pay up. However, in spite of the easy process to buy the insurance, the buyer has an obligation to understand what he/she is purchasing. Having said that, I believe the insurance companies need to write their policies in a way that can be more easily understood by the average person. It may be true that all the warnings are included in the contracts, but they are written with so much legal jargon that only a lawyer can make sense of them.

I purchased my insurance that summer through The Magnes Group Inc. (Magnes), the administrator of COPA’s aircraft insurance program. COPA members can buy VIP Gold, Silver and Bronze packages from this broker, each one offering different coverage. The Bronze plan is specifically for pilots who rent or borrow airplanes, which suited me at the time. I called the Magnes sales office, explained what I thought I required, asked a lot of questions, and then decided the plan would cover my needs. I also bought hull insurance for any aircraft I would be operating.

When an accident or incident occurs, all it takes is one phone call to get the ball rolling on a claim. In this case, the call was to Magnes. As my broker, they formally reported the claim to the insurance company, which is the AIG Insurance Company of Canada. The insurance company then has the option of handling the claim in-house or appointing an independent adjustor who works on their behalf. Due to the nature and location of the incident, AIG appointed an independent adjustor. All my discussions and contact from that point were with this adjustor.

For any pilot who has never had an insurance claim let me offer some advice and provide details of what happens in the process. First of all, you need to be proactive. You must be sure before you buy the insurance in the first place, that your bases are all covered. That means your pilots license and medical certificate need to be valid. You have to be meticulous about the paperwork with the airplane you fly. The C of A, C of R, annual inspection report, weight & balance document, operators manual (POH), your personal and journey log books and your radio operators license should be carried with you. Some STC’s, if you have any on your plane, should be there too, along with the first-aid kit, your glasses and don’t forget an up-to-date compass correction card. Think “ramp check” to be sure it’s all there. To begin processing your claim, the adjustor will need copies of the last few pages of the technical logs and your own log book. Be certain all this is complete and current because claims can be denied based on missing relevant information. Then stay in touch with your broker as he/she is there to represent you in the event that the claim is not running smoothly.

If you’re certain all is ready for the adjustor, you can be confident that your claim won’t hit any bumps in the road due to a technicality. Think about the last time you went through all the paperwork to be sure it’s there. On a rental or borrowed aircraft, the pilot in command is responsible, so you’ll need to check every time you fly another airplane.

Once that part of the process is done, the damage will be assessed. I don’t know if there’s a common practice among all the adjusters, or if it’s a case-by-case procedure. Some might require a few pictures of the damage, and/or estimates from an aircraft structures mechanic. The adjustor and/or your broker can be a helpful resource for explaining the various options and suggesting vendors if necessary. In the case where the insurance company assigns its own in-house adjustor, that person may even come out and do a personal inspection of the wreckage.

The adjustor, if he is independent, submits his recommendation to the insurance company, who will then usually act on it and pay accordingly. If the insurance company has elected to handle the claim in-house, then the process may be streamlined a bit.

The adjustor eventually assigned to settle my claim was fair and decisive. Following an initial stressful delay, with assistance from COPA and Magnes the process ended favorably (for me). I was impressed and pleased. Although this was the first insurance claim in my flying career, I felt bad because it was the first time I had bought a policy from Magnes and the policy had been purchased just one month prior to the incident.

Some pilots don’t worry about all of the procedures and the rules. For the most part, it is simply because they don’t put in enough time and effort into understanding their responsibility in purchasing the proper coverage. We all fear the ramp check, but nobody thinks there will be an accident to deal with. It would be tragic to have an aircraft damaged and the claim denied on a technicality. The best advice is to be certain of all your regulations and requirements, then take care of it all before you fly.

One final note would be a statement of appreciation to Kevin Psutka (COPA) and to Belinda Bryce (Magnes Group) who intervened with assistance to get through the initial problems in this claim. Purchasing the COPA insurance gives the pilot a measure of security with the knowledge he's not alone if things go sour.