The insurance company is still obligated to defend you even if they agree to
pay out their policy limit. So usually what happens is the insurance
company offers up their policy limit (usually $100,000 per passenger) in
exchange for the plaintif accepting that as the total liability of the
insured, thus letting the insured off the hook for further damages. Most
people take the $100,000 and walk away unless the insured is seriously
loaded.

It is rare for a plaintif to refuse to settle for the $100,000. Usually
it's more lucrative to take the $100,000 then turn around and sue every
repair shop that ever touched your aircraft. I know of once case where the
family of the victim of a small plane crash received $100,000 from the
aircraft owner's policy and $100,000 each from two separate repair shops
that had done annuals and/or light maintenance on the aircraft prior to the
accident.
"M" wrote in message
ups.com...

If you never carry passengers other than your immediate family members,
then the 1M smooth policy is a genuine waste of money.

However if you do even occasionally carry passengers, you should
seriously consider 1M smooth policy. Almost all the plane owners have
at least several hundred thousands worth of personal assets. In a
crash that results in personal injury the $100k submit can't even begin
to pay for anything, and the insurance company will likely wash its
hands and pay out that $100k w/o spending much on a good attorney for
your defense. The 1M liability will cause the insurance company to
take the case seriously and spend money on a really good attorney.

--M

Jonathan Goodish wrote:

Personally, I don't think that a $1M smooth policy really buys you much
additional risk protection over the per-seat sub-limits. In my case it
makes even less sense, as I rarely ever carry passengers, other than my
wife.

Note also that some policies specify PER SEAT sub-limits, and other
policies specify PER PERSON sub-limits. The former places compensation
limits on the passengers, while the latter places compensation limits on
everyone, including people on the ground.

I suspect that if you routinely carry passengers, and have substantial
assets, a higher-value "smooth" policy might make more sense. In my
opinion, the $1M smooth is little more than a "feel good" policy for
most people.



JKG