DID YOU KNOW about switching coverage from builders to flight?

During all of your hard work while building your aircraft, you couldn?t wait to get it up in the air. When it?s time to fly, make sure you remember to update your insurance policy. In fact, it may be beneficial to update the policy prior to being ready to fly. Did you know there is no coverage under a builder?s risk policy once the aircraft is moving under its own power? You can put fuel in the tank and you can start the engine, but if the plane gets away from you, there?s no coverage. We want to make sure you have the right coverage at the right time. If you?re ready to get a full flight quote or even if you just started building, give us a call for quotes. At Gallagher, we have our girls that work specifically on Vans, but we also have several other people on our team that can quote just about any type of aircraft you can come across.

Recently our project became and aircraft. As Leah so wisely suggested, I worked hard to get good and complete "hull in motion" insurance coverage prior to actually putting the airplane in motion. During this process I had an opportunity to view policy wording from two different underwriters. The wording clearly stipulated that if the engine was running the aircraft was considered to be "in motion" and thus would not be insured by the not-in-motion builder's insurance. Same goes for the condition where the aircraft is in motion but not under power (gliding or rolling along) - it's in motion thus not covered unless you have "hull in motion" coverage on your policy. Two different brokers confirmed my interpretation of the policy wording, which is slightly at odds with the info provided by Leah.

Leah is no doubt an absolute expert in aviation insurance in the US market and I do not question in the least what she has written as it pertains to the US market. The perspective I've mentioned is perhaps uniquely Canadian. I bring up this potential difference in policy wording as a heads-up to fellow Canadians that insurance policies issued in Canada may be substantially different from those issued in the USA, thus we need to be sure the information with which we are working is indeed reflective of Canadian policy wording.

Canadian_JOY said:

Recently our project became and aircraft. As Leah so wisely suggested, I worked hard to get good and complete "hull in motion" insurance coverage prior to actually putting the airplane in motion. During this process I had an opportunity to view policy wording from two different underwriters. The wording clearly stipulated that if the engine was running the aircraft was considered to be "in motion" and thus would not be insured by the not-in-motion builder's insurance. Same goes for the condition where the aircraft is in motion but not under power (gliding or rolling along) - it's in motion thus not covered unless you have "hull in motion" coverage on your policy. Two different brokers confirmed my interpretation of the policy wording, which is slightly at odds with the info provided by Leah.

Leah is no doubt an absolute expert in aviation insurance in the US market and I do not question in the least what she has written as it pertains to the US market. The perspective I've mentioned is perhaps uniquely Canadian. I bring up this potential difference in policy wording as a heads-up to fellow Canadians that insurance policies issued in Canada may be substantially different from those issued in the USA, thus we need to be sure the information with which we are working is indeed reflective of Canadian policy wording.

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I?m glad you brought this up. This is a great point! We only write policies for the United States so there may be differences between our policies and the Canadian policies that we are unaware of.

Just to be sure we didn't give out incorrect information, we researched several of our companies policies and talked with a couple of underwriters. Each company states that the ?in motion? coverage means anytime the aircraft is in flight or the aircraft is moving under its own power or any momentum from the power.

The builders risk policies have coverage for not in motion only. This means as long as the aircraft is not moving under its own power or moving because of its power, there is still coverage under the builder?s risk policy.

Thanks for providing this unequivocal clarification, Leah. All the more reason for us to really read and understand our insurance policies, and to work with knowledgeable aviation-specific insurance brokers who can get these questions answered with clarity.

I ran into this very exact issue. I had (incorrectly) assumed that the builder policy would remain in effect until I received the airworthiness certificate. So a couple of weeks prior to the AW inspection I contacted my insurance agent saying that it was time to begin shopping around for a policy. That was when I was informed that if the aircraft is "capable of moving under its own power" the builder policy is no longer valid ... so no coverage for any ground operations or theft while in the hangar.

OK, no big deal … just get a regular policy right? Well, unfortunately, to cover my RV-12 the insurance company required that I have at least 5 hours in a RV-12 before I would be covered. So everything came to a screeching halt no ground engine runs, no conditioning of the brakes, no taxing to the compass rose, ect . … I had stop everything and seek out a flight school that had a RV-12 (none in my state) and fly to the training center and receive the required time in the RV-12 to satisfy the insurance requirement.

So the point I’m making is in addition to the no builders coverage when the aircraft is capable of moving under its own power, builders may also find themselves required to meet additional insurance requirements before their policy is valid ... and may (as I was) be required to have actual flight time in a RV before the new policy will cover ground or flight operations. My suggestion to fellow builders is to get some time in a RV like the one you are building during the build so the insurance transition from the builder policy to the regular policy will not only be painless but also without long delays for the builder.