Hull/Liability Insurance Recommendations

Dave Stadt wrote:

"TripFarmer" wrote in message
...

IMHO, you should have enough to cover your assets. Then you should
make sure you have enough to cover any future earning you don't want to
give up. If you have $1-2M and are an average guy you should have enough.


Trip


You cannot cover your assets with liability insurance. Best you can do is
hope they go after your liability insurance and leave you assets alone.

What...they "forget"?

(Rick Durden) wrote
You got good advise back when you got it.

When was that? I guess I'm really amazed how you are able to
determine when I got that advice.

The aviation insurance market has changed so much in the
last decade that it is not possible to get enough insurance to make
oneself a "target".

A million dollars is a pretty inviting target. On contingency, that's
$300K-$500K in the pockets of the attorney - worth a long shot.

Now, if you have the assets to own an airplane,
you have the assets to be a target.

Maybe that's the case if your airplane is an impulse purchase. For
most people I know, the airplane is the major asset - one they had to
borrow to purchase. I suppose that might be because I'm not an
attorney and don't know too many pilots who are.

With most people I know, once you take the house (if any) and the
airplane out of the picture, there's simply not much there in the way
of assets.

You are correct that a
plaintiff's attorney will not go after a dry hole; the problem is that
sublimits of $100,000, is not enough to stop an attorney from going
after the owner's assets should there be a serious injury or death.

You're not making sense. If the owner is a dry hole (or close to one)
$100K is about all there is. Are you telling me a plaintiff's
attorney will pass up a $100K settlement to roll the dice on a
possible $200K? Now if we're looking at assets in the $1M range,
that's another story. I don't know too many light plane owners in
that range.

The fact that a person owns an airplane is a pretty good indication
that there are assets to be reached in the event of a suit, even if it
is the insurance check that went to the owner to pay for the airplane
after the crash.

That's less than $100K in most cases, and most people have a note so
the bank gets paid first and immediately. Go try to get that money
after the bank has it...

You know, there are those who can easily afford aviation, and there
are those who can only afford it because they make it a priority. I
think your advice may be relevant to the former group, but not the
latter. It's a very rare individual who makes enough money to support
a family, own an airplane, and have anything at all left over for the
lawyers to take.

Yes, some owners have structured their assets to get
them beyond reach of a lawsuit, or they think they have. They may
have moved them offshore, illegally, and the lawsuit may lead to a
discreet call to the IRS by the plaintiff's attorney that buys the
owner an opportunity to defend an action by the IRS and potentially,
criminal charges.

Or they may have put them into a house, untouchable even in the event
of bankruptcy.

As for plaintiff's attorneys who have a habit of dropping the dime on
those who have illegally moved their assets offshore, they have a bad
history of getting their knees broken. People willing to break the
law are, well, willing to break the law.

given up on getting any higher limits, because they are no longer
available.

Want to clue us in - WHY are they no longer available? Would it be
because insurance companies have figured out that the settlement will
be based on how much coverage there is, rather than how much damage
was actually done? Would it be because they've figured out that the
increased coverage simply makes you too tempting a target?

Consider it as a simple matter of statitstics - if I'm wrong and the
amount of insurance is not a large factor in making you a target, you
could get $5M smooth simply by paying 5 times the rate for $1M smooth.

Michael

"Michael" wrote in message
om...
(Rick Durden) wrote
You got good advise back when you got it.

When was that? I guess I'm really amazed how you are able to
determine when I got that advice.

The aviation insurance market has changed so much in the
last decade that it is not possible to get enough insurance to make
oneself a "target".

A million dollars is a pretty inviting target. On contingency, that's
$300K-$500K in the pockets of the attorney - worth a long shot.

Now, if you have the assets to own an airplane,
you have the assets to be a target.

Maybe that's the case if your airplane is an impulse purchase. For
most people I know, the airplane is the major asset - one they had to
borrow to purchase. I suppose that might be because I'm not an
attorney and don't know too many pilots who are.

With most people I know, once you take the house (if any) and the
airplane out of the picture, there's simply not much there in the way
of assets.

You are correct that a
plaintiff's attorney will not go after a dry hole; the problem is that
sublimits of $100,000, is not enough to stop an attorney from going
after the owner's assets should there be a serious injury or death.

You're not making sense. If the owner is a dry hole (or close to one)
$100K is about all there is. Are you telling me a plaintiff's
attorney will pass up a $100K settlement to roll the dice on a
possible $200K? Now if we're looking at assets in the $1M range,
that's another story. I don't know too many light plane owners in
that range.

The fact that a person owns an airplane is a pretty good indication
that there are assets to be reached in the event of a suit, even if it
is the insurance check that went to the owner to pay for the airplane
after the crash.

That's less than $100K in most cases, and most people have a note so
the bank gets paid first and immediately. Go try to get that money
after the bank has it...

You know, there are those who can easily afford aviation, and there
are those who can only afford it because they make it a priority. I
think your advice may be relevant to the former group, but not the
latter. It's a very rare individual who makes enough money to support
a family, own an airplane, and have anything at all left over for the
lawyers to take.

Yes, some owners have structured their assets to get
them beyond reach of a lawsuit, or they think they have. They may
have moved them offshore, illegally, and the lawsuit may lead to a
discreet call to the IRS by the plaintiff's attorney that buys the
owner an opportunity to defend an action by the IRS and potentially,
criminal charges.

Or they may have put them into a house, untouchable even in the event
of bankruptcy.

As for plaintiff's attorneys who have a habit of dropping the dime on
those who have illegally moved their assets offshore, they have a bad
history of getting their knees broken. People willing to break the
law are, well, willing to break the law.

given up on getting any higher limits, because they are no longer
available.

Want to clue us in - WHY are they no longer available? Would it be
because insurance companies have figured out that the settlement will
be based on how much coverage there is, rather than how much damage
was actually done? Would it be because they've figured out that the
increased coverage simply makes you too tempting a target?

Consider it as a simple matter of statitstics - if I'm wrong and the
amount of insurance is not a large factor in making you a target, you
could get $5M smooth simply by paying 5 times the rate for $1M smooth.

Michael

You and I know people in entirely different financial situations. What you
say might be true for a minority of airplane owners but Rick is right in the
main.

"Gene Kearns" wrote in message
...
On Wed, 13 Oct 2004 10:30:07 -0700, Jim Weir wrote:
For what it is worth, I know them, personally, and can vouch for
them... they insure both of my A/C. I drive past their office every
day.

Give them a call... it is toll free. They gave me good coverage for a
great rate.... and I suspect they can meet or beat any rate you've
gotten elsewhere.


AMEN! We insure our two Luscombes with AUA. Lowest quotes and best service
bar none after 30 years of aircraft ownership. There are discounts for EAA
Vintage membership and AOPA membership. Our rates actually went down $100 on
each last year because we fly frequently.

Deb

--
1946 Luscombe 8A (His)
1948 Luscombe 8E (Hers)
1954 Cessna 195B, restoring (Ours)
Jasper, Ga. (JZP)

"Dave Butler" wrote in message
...
The webmaster may have made the original error, but I'm with Jim on this
one. The person/company who hired the webmaster failed to do basic quality
control on the web presentation. I'll avoid doing business with companies
for similar reasons. It shows a lack of attention to detail.

Which is sad for you. As an aircraft owner you may have just bypassed the
best aircraft insurance company out there. We've done the research. No
company will insure our fleet of airplanes at affordable prices except AUA.
Some will not insure them at all.

Deb

--
1946 Luscombe 8A (His)
1948 Luscombe 8E (Hers)
1954 Cessna 195B, restoring (Ours)
Jasper, Ga. (JZP)

Michael,
You got good advise back when you got it.

When was that? I guess I'm really amazed how you are able to
determine when I got that advice.

The advise you described is about ten years old (give or take five)
and was the common approach back then.

The aviation insurance market has changed so much in the
last decade that it is not possible to get enough insurance to make
oneself a "target".

A million dollars is a pretty inviting target. On contingency, that's
$300K-$500K in the pockets of the attorney - worth a long shot.

Actually a contingency is one third, after expenses. Once you figure
in the time involved in putting together the suit, unless the damages
are huge and liability is a slam dunk, and the fact that the
plaintiff's attorney has to bankroll the case for two to five years,
it's not enough money to make a person a target. In this day an age,
it simply isn't.

Now, if you have the assets to own an airplane,
you have the assets to be a target.

Maybe that's the case if your airplane is an impulse purchase. For
most people I know, the airplane is the major asset - one they had to
borrow to purchase. I suppose that might be because I'm not an
attorney and don't know too many pilots who are.

With most people I know, once you take the house (if any) and the
airplane out of the picture, there's simply not much there in the way
of assets.

That's why insurance has to be a part of an objectively thought out
risk evaluation for each pilot. For the folks you know, $100,000
sublimits may very well be adequate. In my observation, for most
airplane owners, they are not.

You are correct that a
plaintiff's attorney will not go after a dry hole; the problem is that
sublimits of $100,000, is not enough to stop an attorney from going
after the owner's assets should there be a serious injury or death.

You're not making sense. If the owner is a dry hole (or close to one)
$100K is about all there is. Are you telling me a plaintiff's
attorney will pass up a $100K settlement to roll the dice on a
possible $200K? Now if we're looking at assets in the $1M range,
that's another story. I don't know too many light plane owners in
that range.

The problem is perception. If there damages are large, the
planitiff's attorney will simply take the $100,000 (the insurance
company can settle by paying limits without including the pilot in the
settlement, although that can vary, what your insurance company can do
is in the contract), use it as a war chest and go after the pilot's
assets, if there is reason to believe they are worth pursuing. If the
pilot does not have such assets, the $100,000 sublimit may be
adequate.

The fact that a person owns an airplane is a pretty good indication
that there are assets to be reached in the event of a suit, even if it
is the insurance check that went to the owner to pay for the airplane
after the crash.

That's less than $100K in most cases, and most people have a note so
the bank gets paid first and immediately. Go try to get that money
after the bank has it...

You know, there are those who can easily afford aviation, and there
are those who can only afford it because they make it a priority. I
think your advice may be relevant to the former group, but not the
latter. It's a very rare individual who makes enough money to support
a family, own an airplane, and have anything at all left over for the
lawyers to take.

That is a matter for each individual to evaluate. I've simply
observed that by the time a person with a family is able to own a high
performance airplane, that person has enough in the way of assets that
for him or her to protect the family financially, $100,000 sublimits
are not adequate for the task, it leaves to much at risk. By simply
paying a little more for insurance and getting smooth coverage, the
risk drops. Whether that is appropriate is an individual decision and
should be taken, in my opinion, with due regard for one's family.

Yes, some owners have structured their assets to get
them beyond reach of a lawsuit, or they think they have. They may
have moved them offshore, illegally, and the lawsuit may lead to a
discreet call to the IRS by the plaintiff's attorney that buys the
owner an opportunity to defend an action by the IRS and potentially,
criminal charges.

Or they may have put them into a house, untouchable even in the event
of bankruptcy.

True, but rare, in my observation over the years.

As for plaintiff's attorneys who have a habit of dropping the dime on
those who have illegally moved their assets offshore, they have a bad
history of getting their knees broken. People willing to break the
law are, well, willing to break the law.

given up on getting any higher limits, because they are no longer
available.

Want to clue us in - WHY are they no longer available? Would it be
because insurance companies have figured out that the settlement will
be based on how much coverage there is, rather than how much damage
was actually done? Would it be because they've figured out that the
increased coverage simply makes you too tempting a target?

The aviation insurance companies have only made a profit in about one
or two years of the last ten. Two have gone bankrupt. They have made
the decision to write lower limits and cocentrate on the $100,000
sublimit coverage for pilots because it makes them more money.

They have also simply stopped offering high limits because they lost
money on them. It was, in my opinion, based on observation, a
business decision. The aviation market is tiny, perhaps 250,000
airplanes out there, fewer than there are cars in a decent sized city.
The companies are competing for business in a small market and those
who were not extremely conservative in their underwriting have gone
under. Do you remember the Omni, back in the 1970s? They would write
about anyone flying anything for any coverage. They went under pretty
spectacularly. American Eagle had lower rates than most everyone and
offered some pretty high limits when others wouldn't. They went
under. The remaining companies stopped writing high limits because
they could not charge high enough premiums to make the risk
worthwhile.

Consider it as a simple matter of statitstics - if I'm wrong and the
amount of insurance is not a large factor in making you a target, you
could get $5M smooth simply by paying 5 times the rate for $1M smooth.

The amount of insurance can make you a target, it's just that a
million smooth isn't enough to do so (and that's only my opinion but
it is based on working in this business on a day to day basis). Ten
million might very well make you a target (although you still have to
have an accident for it to matter), and the insurance companies have
taken that option away from us.

It boils down to each pilot objectively analyzing risk and not simply
buying what is the least expensive. I've just seen too many pilots
get burned from doing so.

All the best,
Rick

Actually a contingency is one third, after expenses. Once you figure
in the time involved in putting together the suit, unless the damages
are huge and liability is a slam dunk, and the fact that the
plaintiff's attorney has to bankroll the case for two to five years,
it's not enough money to make a person a target. In this day an age,
it simply isn't.

But, but, but...

That can't be the case. Plaintiff's attorneys are working to help the
injured little guy (and the chilluns). I know cus I saw it on TV.

Actually we may get to the day when the only ones left in our society with
enough assets to be targets are the attorneys.

Howard


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"Howard Nelson" wrote in message . com...
Actually a contingency is one third, after expenses. Once you figure
in the time involved in putting together the suit, unless the damages
are huge and liability is a slam dunk, and the fact that the
plaintiff's attorney has to bankroll the case for two to five years,
it's not enough money to make a person a target. In this day an age,
it simply isn't.

But, but, but...

That can't be the case. Plaintiff's attorneys are working to help the
injured little guy (and the chilluns). I know cus I saw it on TV.

Actually we may get to the day when the only ones left in our society with
enough assets to be targets are the attorneys.

Howard

Howard,

If you look at the stats, the average income for attorneys has been
dropping the last several years. Don't know how that fits anything in
the discussion g.

All the best,
Rick


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Henry and Debbie McFarland wrote:
"Dave Butler" wrote in message
...

The webmaster may have made the original error, but I'm with Jim on this
one. The person/company who hired the webmaster failed to do basic quality
control on the web presentation. I'll avoid doing business with companies
for similar reasons. It shows a lack of attention to detail.


Which is sad for you. As an aircraft owner you may have just bypassed the
best aircraft insurance company out there. We've done the research. No
company will insure our fleet of airplanes at affordable prices except AUA.
Some will not insure them at all.

Having a personal recommendation from someone I know [like you ;-)] overrides
considerations of grammatical and spelling errors on web sites. I'm talking
about when I want to buy a widget, I google for widgets, and I'll bypass any
sites with obvious errors. I'll keep your recommendation in mind next time our
insurance comes up.

DGB

Rick,

Has there ever been a case where a plaintiff went after a pilots estate and
won when there was $1MM insurance coverage? It was explained to me that the
insurance company was such an easy target (in a jury trial) and the pilot's
family such a difficult one, that it isn't worth the risk of going to trial
against the pilots family and that cases settled for the insurance limit.
Thanks for the insite!

Mike
MU-2