Insurance settlement on Black Magic

Lots of research, lots of input, lots of phone calls culminated with me signing the Policyholder's Release from AIG this afternoon for the damage to Black Magic. The check was to be written before 2PM. The agreement was relayed to me about 4:15 Friday afternoon. I opted to hold off posting anything until the release was signed and notarized and sent back to AIG.

First of all let's address the FAA. As defined by the NTSB this was an accident and was reported. The local FSDO, at least, uses $25,000.00 in damages as the defining amount of substantial damage subsequent to flight, or intended flight, to tip the scale. Accident in a big way.

Now about the accident, I am again holding off on saying anything since I haven't got the final back from the FAA, and such. Once again, Black Magic was parked and unoccupied on the ramp. At no time has there been a reference to anything contrary. Just want to let that one work it's course. I have the pilots NTSB statement in my file.

If there was anything good about this accident it was that it occurred on Memorial Day Sunday. The FAA and both insurance companies, were closed until Tuesday, thereby enabling me to educate myself, albeit force feed, on various aspects of an experimental airplane claim. Example, I got a lot of private emails, even one that said, "Dana, check the profiles of some of these people posting".....I already had and had spoke to several. Suffice to say, there is a lot of expertise on this board and, as usual with VAF, they were willing to talk and help. Thank you all.

Now insurance. Instead of posting a long narrative, it may be best to answer questions. I'll throw some thing out here to spur discussion.

First of all...........carry hull. Carry at what the airplane is worth. Do not intentionally understate the hull amount. You will be sorry. Your hull people are your advocates.

Total means damage payout plus salvage. If those two added together are over hull, it's total. Damage plus salvage greater than FMV for the liability side, total. So if it's going to be total, and your hull is less than FMV, you want it totaled on the liability side.

When the other adjuster wants a replacement value, give him Barnstormers sales add or similar ads.

Respond in a timely manner, in writing if you deem so.

Educate yourself.

Start a file

Talk, you don't have to be a jerk

Don't make anything up, be truthful

Let it be known up front where you want the claim to go, I wanted my airplane, not just a check.

Do not do anything that would prevent your company from being able to subrogate.

My impression: AIG Claims Representative Eric Rank was acually enjoyable to work with. And that is what we did, we worked together. I did my job, he did his but he was my advocate. As I stated above, I was upfront as to what I wanted, in the first couple sentences to Eric. We had a goal to work towards and it was always just keeping the eye on the ball. U.S. Specialties adjuster was not my advocate but I believe truly was ready for me to demand, and receive, the fair market value of my airplane in total. I don't believe AIG is going to have any problem in subrogation. I just didn't find I had to be a jerk, demanding, threatening, which I truly believe would have extended the process and just would have made it adversarial. I guess I've always been one to think most of the time, it is better just to talk and work it out than threaten, beat on your chest and just end up looking like an *******.....I mean donkey.

This settlement may seem quick to some on this list but the settlement time frame was on my terms. I spent a lot of time talking with knowledgeable people and documented my claim.

Fire off some questions, I'll do my best or at least relay how the process worked for me.

I hate to raise it now given where you are in the process - but so much educational information has gone by. From dealing with airport/Federal authorities, securing a plane, documenting what happened, insurance, break-down and transport issues...

Perhaps at some point the folks who have been through this agony could start an Accident FAQ.

Best wishes on the rebuild.

Great info, thanks! Get 'er done!

Dana,

First, thanks on two counts. I have insurance through Jim Pappas and he isn't writing anymore, so I took your recommendation. Secondly, I upped the hull coverage to actual, not just what I could build it for. Sounds like very good advice.

Best of luck, and let me know when you need someone to turn wrenches.

Bob Kelly

We also decided to up our coverage immediately after reading your initial account of your event. It was the way that reading, in almost real time, about your misfortune made me feel that was the deciding factor. Thanks for allowing us to feel your pain.

Nice work

Dana,
As a trial lawyer, I deal with insurance claims people on a regular basis. It sounds like you handled your claim like a pro. This is valuable information for others. Your best advice is to adequately insure your ship. Being underinsured really puts you behind the 8 ball if something happens.

srv said:

I hate to raise it now given where you are in the process - but so much educational information has gone by. From dealing with airport/Federal authorities, securing a plane, documenting what happened, insurance, break-down and transport issues...

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OK, lets look at the first one airport/Federal authorities. The airport FBO initially, changed his mind later on, and was great to work with, and the jump school were adamant in the beginning that "we" didn't want the FAA involved. I had nothing to hide so I was wondering if they had a mouse in their pocket, thus the "we". The NTSB's definition is: "An accident is defined as 'an occurrence associated with the operation of an aircraft which takes place between the time any person boards the aircraft with the intention of flight and all such persons have disembarked, and in which any person suffers death or serious injury, or in which the aircraft receives substantial damage". The pilot of the 180 had dropped jumpers, landed, and was taxiing back to pick up more jumpers..........thus "all such persons have disembarked, and.......the aircraft receives substantial damage". Obvious it had to reported on a 6120 per 49 CFR 830, and was reported. This pretty much puts an end to the old wives tale, anything that damages a flight surface is an accident. In talking with the FAA on Tuesday afternoon, they relayed to me anything that causes over 25K in airplane damage, during flight or subsequent to departure from the aircraft is an accident.

One funny part. In talking with the examiner, after the on site visit, she ask if I had seen the sliced off part of the prop. I told her I was looking at it sitting on my desk and would be disappointed if they ask for it back, as I wanted to make something out of it........kinda like the prop blades.......a mail box leg??, Anyway, she said they have to "find" all parts.........I ask her if a picture would to........Yes was her answer......so I have a new desk ornament.

All the FAA asked for was a copy of my operating limitations, special airworthiness certificate and registration.

Securing............documenting.........insurance............transport...............breakdown.
..............next question.

The answers to the above will be pretty darn informative.

AIG & Travers and Associates.................YOU ROCK

Dana,

Glad to hear that everything has turnd out as well as could be expected under the circumstances...maybe a little better for you. Thanks for all the information you shared through your experience.

Such a beautiful aircraft you have. You'll have her back in the air in no time.

Dana,

That was fast. Good for you taking the "high road" and working with everyone in good faith.

I hope the rebuilt plane (Black Phoenix) is everything Black Magic was and more.

N941WR said:

Dana,

That was fast. Good for you taking the "high road" and working with everyone in good faith.

I hope the rebuilt plane (Black Phoenix) is everything Black Magic was and more.

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Hah, that is funny you mentioned the Phoenix thing, as I and others have thought about that, but since Black Magic was not totaled, I have no problem in her casting some nasty spells..... just a little on the quicker side.......

With all this back slapping going on, does that mean I dont have to build a new tank for you? I thought you were going to send me the parts but with all this gibber jabber I figure you got enough time on your hands to do it yourself

Magic

Dana:

I vote "Magic".

Bill: No offense. Great idea though!

Kahuna said:

With all this back slapping going on, does that mean I dont have to build a new tank for you? I thought you were going to send me the parts but with all this gibber jabber I figure you got enough time on your hands to do it yourself

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Not a chance, I already called Scott at Van's today and have the tank headed your way.............next day.........hope you don't mind...........heck with the pity, what do you think Captain..............We got a job to do!!

Dana, congrats on the successful navigation of treacherous waters and good luck with a speedy rebuild.

Q1, why does YOUR hull have anything to do with the total vs repair equation when it's the other guys insurance that owes you a repair?? If it's my fault and my insurance is doing the repair it makes sense that my hull insurance is the factor. It seems to me that the liability limit in the other guys policy might limit how much you get here. From reading the threads it appears I'm wrong but I don't get why.

Q2, is the twist in the fuse going to require a new longeron, a splice, or a bend back to right form fix?

grantcarruthers said:

Q1, why does YOUR hull have anything to do with the total vs repair equation when it's the other guys insurance that owes you a repair?? If it's my fault and my insurance is doing the repair it makes sense that my hull insurance is the factor. It seems to me that the liability limit in the other guys policy might limit how much you get here. From reading the threads it appears I'm wrong but I don't get why.

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I too would like to fully understand this as I don't at this point. He is at fault so what gives?

Also what part does Travelers and Associates play in this and were they contracted by you after this accident and who pays for their services?

FMV

For the record, the agent at Falcon Insurance (with Global as the actual insurer) informed me they will not issue hull insurance for anything less than the approx fair market value. In other words, I couldn't insure my -9A for $50K on the hull when they are selling for $75K and up.

Steve

grantcarruthers said:

Q1, why does YOUR hull have anything to do with the total vs repair equation when it's the other guys insurance that owes you a repair?? If it's my fault and my insurance is doing the repair it makes sense that my hull insurance is the factor. It seems to me that the liability limit in the other guys policy might limit how much you get here. From reading the threads it appears I'm wrong but I don't get why.

Click to expand...

Think of airplane insurance in three aspects: hull, your liability and his liability. Your hull covers just that, hull. Your liability covers incidentals such as travel, storage and moving of the airplane, among other things. The incidentals on your liability side do not factor into the hull settlement, in calculating whether the airplane is totaled. His liability covers it all, hull and incidentals and other claims. His hull obviously does not play into the equation.

AIG will file a claim, subrogate, with the jump school insurance for the amount they paid me. It doesn't matter who pays it up front, the party at fault will eventually pay. The only difference is who they make the check out to. It is such a small community out there in aviation insurance. They all know each other and talk it out, it's a three way deal, you, your insurance and their insurance.

All it is, is moving money around. Think of it like this, all the insurance guys sit around the card table at 8 every morning with a wad of money in the middle. They deal the cards out and start playing. At the end of the day, some have more money, some have less.........at 8 the next morning, they deal the cards out again.

As for the liability limit on the other guys policy, most aviation insurance is 500,000 to 1 mil I have found.

Brantel said:

Also what part does Travelers and Associates play in this and were they contracted by you after this accident and who pays for their services?

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You contact your agency initially, they in turn contact your carrier who assign a claims representative. That was the end of my dealings with my agency. The process works like this: you deal with your claims representative initially, if you are not happy with the results, you go to your agency.

It's actually Travers & Associates www.traversaviation.com

(AIG will file a claim, subrogate, with the jump school insurance for the amount they paid me. It doesn't matter who pays it up front, the party at fault will eventually pay. The only difference is who they make the check out to. It is such a small community out there in aviation insurance. They all know each other and talk it out, it's a three way deal, you, your insurance and their insurance.)

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So, the way I read it is that your insurance will pay you and they will subrogate with the jump school insurance. Will that be a black flag on your claim record? I believe that that is so on the automotive end. Not sure that you will not have a claim (accident) on your record now.

Tbone said:

So, the way I read it is that your insurance will pay you and they will subrogate with the jump school insurance. Will that be a black flag on your claim record? I believe that that is so on the automotive end. Not sure that you will not have a claim (accident) on your record now.

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That is correct about subrogation. When you get insurance, there is a question you answer......."have you had a claim in the last ____ years". It doesn't say, "have you had a claim with us". You have to answer that question truthfully. The claim is there, no matter who pays initially. Initially is the key word here. What you want is for your insurance company to not be out any money in subrogation. I feel certain, AIG will receive full restitution. Look at it this way, I was at no fault in the accident, AIG is fully compensated in subrogation, all is happy on my end. Not so happy on the jump school's liability side, he will end up paying increased premiums.

Sooooo....

You got the airplane back and they gave you a check for....??????

Frank

Upping my Hull as my insurance is comming up for renewal

BlackRV7 said:

All it is, is moving money around. Think of it like this, all the insurance guys sit around the card table at 8 every morning with a wad of money in the middle. They deal the cards out and start playing. At the end of the day, some have more money, some have less.........at 8 the next morning, they deal the cards out again. .

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.......And they wield more power in our day to day flying than the FAA.

Grantcarruthers
Maybe this will help answer your question about hull ins. Just say you have a 75k RV you have it insured for 50K and you have an accident that would cost 55K to repair. The ins. co. will write you a check for 50K and own your aircraft and they will have a 20K valued aircraft for their trouble. They may offer you an option to buy your plane from them for X amount. I'v seen this happen.
Cheers

grantcarruthers said:

Q1, why does YOUR hull have anything to do with the total vs repair equation when it's the other guys insurance that owes you a repair?? If it's my fault and my insurance is doing the repair it makes sense that my hull insurance is the factor. It seems to me that the liability limit in the other guys policy might limit how much you get here. From reading the threads it appears I'm wrong but I don't get why.?

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I don't understand this either, even given Dana's subsequent explanation. I think we may be coming to some incorrect conclusions. Everybody running to up their hull coverage is probably exactly what the insurers are hoping we do. I would offer that the best way to get this figured out is not by asking or getting advice from your insurance company or agent, but by asking your attorney.

It seems to me that the question is not will you be covered for your loss when another is at fault, it's how soon will you get paid to start repairing. Regardless of whether or not you have hull insurance on your own policy, it is the pilot-at-fault's liability policy that will be paying for your damage, up to the amount it's worth, even if you have no hull coverage on your policy. True, your insurance policy may begin by paying you upfront (up to the amount of your hull policy, assuming you have it) then negotatiate with the at-fault insurance company. This may be of value to you. However, in the end, you're going to get paid, directly or indirectly, by the at-fault liability policy even if you have no hull coverage on your own policy.

Thus, that you will eventually get paid for your loss (and how much you will get paid for your loss) has nothing to do with whether or not you have hull coverage, right? It seems like that in Dana's case, it matters not at all whether or not Dana had hull insurance except that his insurance company was, because Dana had hull coverage, willing to pay him upfront then extract the money from the at-fault insurance company.

Again, I'm just trying to understand this, so if anyone can clarify it, I'm much indebted.

[All of the above is all assuming that the pilot at fault either has liability insurance of some sort or that Dana has some sort of ground-not-in-motion coverage aside from hull.]

Harvey L. Sorensen said:

Grantcarruthers
Maybe this will help answer your question about hull ins. Just say you have a 75k RV you have it insured for 50K and you have an accident that would cost 55K to repair. The ins. co. will write you a check for 50K and own your aircraft and they will have a 20K valued aircraft for their trouble. They may offer you an option to buy your plane from them for X amount. I'v seen this happen.
Cheers

Click to expand...

Say I don't have to have any coverage on my RV period at all. If someone else is at fault, their insurance company will have to pay. I don't see how whether I have hull insurance (or or how much hull insurance I have) has anything to do with it.

On my older cars, I carry no collision insurance. However, if another builder runs into me, their policy will have to pay to fix my car up to the value of my car. How is it any different on an airplane? If Dana's airplane's "book" value is $75,000, the at-fault insurance company will have to pay up to that much to fix it, even if Dana had no coverage at all.

Again, I'm just trying to figure this out, so I'm very open to being corrected.

And they wield more power in our day to day flying than the FAA


Yes, but the FAA doesn't pay to fix your broken airplane or to send you dead passengers' kids to college.

Good Luck

alpinelakespilot2000 said:

Say I don't have to have any coverage on my RV period at all. If someone else is at fault, their insurance company will have to pay. I don't see how whether I have hull insurance (or or how much hull insurance I have) has anything to do with it.

On my older cars, I carry no collision insurance. However, if another builder runs into me, their policy will have to pay to fix my car up to the value of my car. How is it any different on an airplane? If Dana's airplane's "book" value is $75,000, the at-fault insurance company will have to pay up to that much to fix it, even if Dana had no coverage at all.

Again, I'm just trying to figure this out, so I'm very open to being corrected.

Click to expand...

In theory, you are right. In the real world, good luck. The problem with "if it is the other guys fault" is that you may have to prove that before you get to collect. You could spend years fighting a legal battle not to mention a lot of out of pocket expenses and legal fees. Insurance companies not only write checks, the will represent you in a legal altercation. Dana's sad story was clear cut as to liability but that isn't always the case. Many times these things turn into he said, she said arguments that take years to sort out. As my attorney once said "if you have to take it to court, you have already lost."

John Clark
RV8 N18U "Sunshine"
KSBA

alpinelakespilot2000 said:

Say I don't have to have any coverage on my RV period at all. If someone else is at fault, their insurance company will have to pay. I don't see how whether I have hull insurance (or or how much hull insurance I have) has anything to do with it.

On my older cars, I carry no collision insurance. However, if another builder runs into me, their policy will have to pay to fix my car up to the value of my car. How is it any different on an airplane? If Dana's airplane's "book" value is $75,000, the at-fault insurance company will have to pay up to that much to fix it, even if Dana had no coverage at all.

Again, I'm just trying to figure this out, so I'm very open to being corrected.

Click to expand...

You are correct and it can be handled this way. Sometimes, though the more practical way to handle it is through your own company the way Dana did. Black Magic's hull was obviously damaged. Dana carried hull coverage that was obligated to pay to repair that damage. Hull claims are usually pretty clear cut. Adjuster comes out, you get estimates, they write you a check.

Liability claims are usually more difficult. To collect from the other guy, technically, you have to PROVE that HIS negligence caused your damage. Did anyone else's negligence play a role? Did your negligence play any role? How much? Etc. Etc. Etc. Often, it is a lengthy process. Better to collect your "easy" hull claim payment and let the 2 insurance companies deal with deciding who was at fault and what, if anything, each should pay - while you move on.

If you don't carry hull insurance, and someone else damages your airplane, all you can do is sue them and start the process.

alpinelakespilot2000 said:

However, in the end, you're going to get paid, directly or indirectly, by the at-fault liability policy even if you have no hull coverage on your own policy.

Thus, that you will eventually get paid for your loss (and how much you will get paid for your loss) has nothing to do with whether or not you have hull coverage, right?
[All of the above is all assuming that the pilot at fault either has liability insurance of some sort or that Dana has some sort of ground-not-in-motion coverage aside from hull.]

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Steve, your first sentence is exactly what I have relayed. Your second one is somewhat correct. The liability side of the jump school's insurance doesn't even care what you have in hull, they go by the fair market value so let's just throw some made up numbers out. You have hull at 70K and Barnstormers has several priced at 90K. You have damages of 50K and all parties think salvage is 40K. You surely don't want to file a hull claim and only get 70, you will file the liability claim on the at fault insured and get a check for 90K.

I believe you guys are trying to outthink this. In my case the liability portion of the jump school's insurance will be the eventual payer, just no doubt about it. The amount of payment was never in question for me. It was just quicker for me to get paid by my advocate, who works for me, than to file a claim with the jump school's carrier and have to negotiate with someone who fights for his (jump school) client. AIG knows how to file the claim, that's what they do in the regular course of business, hate to put it this way, but I figure let them do the fighting for the money, not me.

You are correct, if I had not had insurance, or no hull insurance, or seriously undervalued hull.....I would have had to file the claim with his liability and fight the fight.

As Steve confirmed from his law practice, it is my opinion, from lots of research here lately, you do not want to intentionally undervalue your hull insurance. Try this on for size, you undervalue your hull at 80% of true value. I believe you are going find a statement in your policy that says something to the effect of "I acknowledge by my signing, I have not undervalued....". Hum me says, you have 50K in damages, they could only pay you 40K, 80%. I know many are going to throw their arms up and say, "they can't do that", but I heard this horror story. Could you win that battle, better not to even have to fight that one. It is also going to make it much easier for them to total your airplane. If I had just bought Black Magic, I probably would have just said total it but I built her and I wanted her back. I didn't just want another RV, I wanted the one I built. Do not undervalue, it can come back to haunt you. It is a can of worms you do not want to open, do yourself a favor, be upfront.

You can talk bad about the insurance companies all you want, but when you need them, they are nice to have.

Thanks Jeff.

By the way, for those of you who were not aware of it, Jeff is in the aviation insurance business.

For example - In this case, what if both airplanes had been taxiing and had collided? Both pilots probably would have some responsibility for their own damage (hull claim). And, both pilots would have some liability in the other's damage. (liability cliam) The amount of liability depends on things like right of way, pilot's distraction, taxi speed, airport familarity, etc. Courts decide these things and no one gets paid until they do. Better for each to file a hull claim with their respective insurers and at least get the airplanes repaired.

Mike S said:

Thanks Jeff.

By the way, for those of you who were not aware of it, Jeff is in the aviation insurance business.

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Yes, I spoke a couple time with Jeff, big help. Thanks Jeff.

I wonder

what would happen if both parties were insured by the same company?

I mean there just aren't that many insurance companies..I wonder what the position would be...My guess is they would want to pay you the hull value, especially if it were lower than the FMV.

Frank

Thanks guys. I think we're on the same page now.

I agree that there is some value in having your insurance company as an advocate for you. I do think an independent attorney would be a better solution than relying on your insurance company to advocate for you (since the latter advocates for itself first... this is especially true in the case Frank suggests above). However, and admittedly, an attorney used in a case like Dana's may cost more than just paying higher premiums for high $ hull coverage year in and year out.

On a related tangent: From what I've gathered, full hull insurance will run at least $1000+/yr over liability only, depending on the hull value. In my case, I've been quoted $1400/yr above liability-only. Thus, this is another one of those areas where we have to decide for ourselves how much money we're willing to pay upfront to avoid risk. Dana's experience does kind of put a personal face on something that is otherwise thought of primarily in intangible terms.

Percentages for hull insurance

alpinelakespilot2000 said:

.....
On a related tangent: From what I've gathered, full hull insurance will run at least $1000+/yr over liability only, depending on the hull value. In my case, I've been quoted $1400/yr above liability-only. Thus, this is another one of those areas where we have to decide for ourselves how much money we're willing to pay upfront to avoid risk. Dana's experience does kind of put a personal face on something that is otherwise thought of primarily in intangible terms.

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Steve, isn't this usually a straight percentage of the hull value?

Are your quotes in the approx. 1.5% of hull value per year range?

gil A

Gil-
It's been a while since I was quoted, but I do suspect that the hull rates are based on a percentage of hull value. However, liability doesn't really have anything to do with the value of your plane, so it will stay the same no matter how much hull insurance you carry. I was quoted about $600 for liability only (I think with $1 mil. limits, but I can't quite remember what I asked them to quote) and if I added $50,000 worth of hull insurance the total policy was pushing $2000/yr. That's where I got the extra $1400/yr for hull insurance above liability only. I'm under 1000 hours total time. If you're low time, the hull insurance is probably going to cost you a lot more, but the liability probably won't change that much. A number of insurance threads have some real world numbers that may prove more useful to you.

Glad this turned out for you, Dana. It always seems that cool heads prevail when working with insurance.

Jeff, since you are in the business, and I don't have a policy on my project yet, I have a question for you. Do most policies have a co-insurance clause? In North Dakota, they have some laws on co-insurance (80%) that most people are unaware of. If Dana had undervalued his hull coverage, would it have come into play.

I hope you get it back in the air quickly!!!

I'm confused, but there's nothing new there. Perhaps someone can help me make sense of the underinsured issue.

Let's use round numbers. Suppose I have a plane worth $100,000 and I get hull insurance for $50,000. If the damage is $49,999, I get a check for $49,999 and I fix my plane. But if the damage is $50,000, do I get a check for $50,000 and the insurance company keeps my damaged plane ?? Is this true of auto insurance also? This isn't helping my jaundiced view of insurance companies.

Thanks, and please excuse my ignorance. Still building, but this will help me make intelligent choices when the time comes.

Blue Book value...

tomcostanza said:

....Is this true of auto insurance also? This isn't helping my jaundiced view of insurance companies.
.....

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For normal autos (i.e., not antiques or collector models) the value is set by the "Blue Book" and that is what the insurance company values your auto at...

I don't think you can under-insure a normal car....

When vans with murals were all of the rage (I'm dating myself.....), the insurance companies specifically stated that the extra value of the "add-on painting" was not covered. This isn't really "under-insured", it's just "not insured" for the extras....

gil A

tomcostanza said:

I'm confused, but there's nothing new there. Perhaps someone can help me make sense of the underinsured issue.

Let's use round numbers. Suppose I have a plane worth $100,000 and I get hull insurance for $50,000. If the damage is $49,999, I get a check for $49,999 and I fix my plane. But if the damage is $50,000, do I get a check for $50,000 and the insurance company keeps my damaged plane ??

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Tom, here is how totalled is figured under the hull portion of your policy. If damages plus expected salvage proceeds to the insurance company exceeds your hull, you get a check for what you valued your hull. In both of the above examples you would get a check for $50,000 and the insurance company would get your airplane, which they would sell at salvage and keep the proceeds. In this case, you lose, they win because you undervalued your airplane in hull. Don't undervalue.

Thanks Dana. And touche' Gil; I really didn't think that through.

alpinelakespilot2000 said:

On my older cars, I carry no collision insurance. However, if another builder runs into me, their policy will have to pay to fix my car up to the value of my car. How is it any different on an airplane?

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Remember guys...Normally car value is determined by actual cash value (ACV). When you purchase hull coverage you have a stated value policy meaning "I say my airplane is worth...$200k..." That determines your policy limits AND how much premium you will pay for that amount of coverage. If it is damaged, the insurance company will pay to replace or repair up to that amount. Now if you have a custom car which may exceed bluebook values by many thousands of dollars, you need to have a rider on your auto policy for the additional amount so your covered in the event of a loss that is not due to anothers negligence, or another person underinsured motorist, that's way off topic. Dana was fortunate enough to carry his own coverage that protected him, had it been his fault, he would still have recovered his loss. Regarding subrogation, most insurance companys will pay the full subro demand when liability is clear, if it's not they may offer to settle for a negotiated amount. Regarding marks on your insurance record? That depends, most times the ISO index is filed against the "at fault" party. Dana should not be indexed for this claim and AIG normally would not hold it against him due to the fact he was not at fault in the claim, had he been at fault he would most likely carry a claims made mark in the ISO index for three years, I'll bet you a nice dinner that the adverse party, the Guy/Gal who hit that beauty of an aircraft will carry that for awhile and can expect a significant increase in premium...liability premium, which is what will cover his portion of the loss.

I'm not spouting off the cuff, I'm just trying to shed some light, I am licensed as an Independent Adjuster and Producer of Property & Casualty Insurance for the State of Nevada.

With the number of RV's damaged at Sun & Fun, I thought it might be worthwhile to bump this old thread on my insurance settlement experience.

Good luck gang. If I can shed any light to anyone going through the insurance process, shoot me an email at dana.overallcpa at gmail com and I'll respond back with a phone number.

Increasing my hull $$

Thanks Dana! I'm taking your advice and putting a more realistic hull value on my plane. I appreciate this thread and your honest info.

More than that, Dana should be an inspiration to get everyone back on the road (runway?) to flight again. I know that when I folded my nosegear, I was very disheartened. The insurance turned out to be the least of my problems. Finding the energy to first disassemble and access the damage and then rebuild was difficult. Having followed Dana's experience was helpful and inspiring to me, not to mention the encouragement I got from many others. In the end, I got to experience the pleasure of a second first flight and the world has untumbled its gyros. However you may feel now, believe me when I say that eventually you'll get past it.

It is too bad the insurance companies just don't pay you the hull coverage set when the value of the plane is actually higher then your coverage. This way you can use the amount to repair it back and in most cases it may be enough just to do that and get back in the air. By totaling your aircraft when the value is higher then the coverage, essentially they are stealing from you, aren?t they?

Lets say, I have an aircraft that has a fair market value of $75k, but I may decide that in most accidents I maybe able to fix it myself with $50K, thus insure it for that amount. There should not be an automatic way for insurance company to total your plane when it is damaged solely based on their choosing. What if the total damage is only $5K? Will they still be able to total it by giving you $50K and fix it just to pocket $20K? And if so what would we call that in a fair-minded practices? robbery comes to my mind, albeit legalized robbery.

It's not stealing when they tell you up front what the policy is and how it will play out in the event of a claim. If you insure for less than it's worth, and the damages cost more than you insure for, it's a write off and you'll get a cheque for that amount less your deductible. This isn't hidden anywhere, and nobody should be surprised by it if it happens. If you haven't read your insurance policy, it's best that you go find it and read it now, so you understand.

Ditto Rob -

Good thoughts.
Aircraft insurance is written on a "Agreed Value" basis, unlike car insurance which is Actual Cash Value (market value at time of loss). Agreed value means that you and the insurer agree up front on the value of the airplane and agree up front about what you'll get in the event of a loss that is not economically repariable - as determined by the insurer.

If you don't agree - call them today and change it.

I do wish that aviation insurers whould allow taking higher deductibles, which is the proper way of doing what many owners are trying to do when they intentionally under-insure. If you could insure for full value and take a $20,000 or $30,000 deductible, I think many owners would consider that.

JDRhodes said:

Good thoughts.
Aircraft insurance is written on a "Agreed Value" basis, unlike car insurance which is Actual Cash Value (market value at time of loss). Agreed value means that you and the insurer agree up front on the value of the airplane and agree up front about what you'll get in the event of a loss that is not economically repariable - as determined by the insurer.
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I don't mean to argue endlessly and think the above quote is perfectly fair and just. However, in the examples given in here and one by me (i.e. If the damage to the A/C is $5K, has been insured for $50K and the A/C values at $75K) and they see an opportunity to make a few $$$ , therefore to declare it total, then one can wonder if that fall in the sprit of what the contract was written?

Doesn't this mean that any damage to the aircraft will mean an automatic total, regardless of the amount of damage?

Bavafa said:

I don't mean to argue endlessly and think the above quote is perfectly fair and just. However, in the examples given in here and one by me (i.e. If the damage to the A/C is $5K, has been insured for $50K and the A/C values at $75K) and they see an opportunity to make a few $$$ , therefore to declare it total, then one can wonder if that fall in the sprit of what the contract was written?

Doesn't this mean that any damage to the aircraft will mean an automatic total, regardless of the amount of damage?

Click to expand...

So, do you mean the salvage value of $75k in the above example, so the insurance co. could settle for $50, and sell off for salvage for $75, thus putting $25k in pocket??? Instead of paying the repair tag of $5,000??

They would net $30k in this deal.

Not a pretty thought