If you looked up your make and model aircraft on Controller or Barnstormers lately, you may have been shocked by what your aircraft could sell for! Flight schools are busier than ever and are struggling to add aircraft to their fleet. Those looking to stop renting and purchase their own aircraft must jump on an aircraft sale immediately to prevent it from being sold out from under them. In addition, the 2020 ADSB mandate had current aircraft owners deciding to modernize their avionics beyond the ADSB requirements. With the rising values in aircraft, is yours insured for what it’s worth?
While it’s easy to start a policy and renew as-is each year, a quick Aircraft Bluebook valuation can determine if your aircraft is underinsured. Aircraft insurance policies are a stated value, meaning if you had a total loss, you receive a check for that stated value, minus any deductible. While insurance policies are renewed on an annual basis, you may increase your aircraft value at any time for a pro-rata additional premium. Some underwriters will request justification for the value, especially if upgrades carry it above base Bluebook. It is best to have handy your engine time, airframe time, and any avionics, interior, or paint updates for your agent to justify the new hull.
While you may save premium by underinsuring your aircraft, you are at risk for a constructive total loss. A constructive total loss is when the cost to repair the aircraft plus the salvage value of the damaged aircraft exceeds its insured hull value. The aircraft owner is left with two choices: to accept the claims check that will not be enough for an apples-to-apples comparable new aircraft or buy back the salvage now belonging to the insurance carrier and have the aircraft fixed.
Aviation Insurance Resources (AIR) is an insurance agency specializing in aircraft insurance. All our agents are pilots. To receive an competitive aircraft insurance quote, or to inquire if you should be increasing your hull value on your aircraft insurance policy, call us today at 301-682-6200 and put your mind at ease.