Preventing out of pocket from getting out of hand

Deductibles are a way for the insurance company to make you participate in the cost of a claim as an added incentive to be alert and avoid carelessness in the cockpit.

With a standard deductible, you may be required to pay anywhere from $0 to $2,500 toward your airplane’s repair cost. If you have an amphibious, seaplane, rotor-wing or other more specialized equipment, a much higher deductible would apply and possibly be expressed as a fixed amount from $10,000 to $25,000. It’s also possible you’ll pay a fixed percentage between 5 percent and 10 percent of the insured value of the airplane.

With other types of insurance, you generally see the premium drop when you take a higher deductible. Not so for aircraft insurance. Taking higher deductibles won’t lower the cost of your airplane insurance much, if at all, simply because insurers expect most claims to exceed a higher deductible, incurring the same amount of claim administration expenses as they would with a lower deductible.

There’s nothing wrong with asking about higher deductibles to lower the cost of your airplane insurance; just don’t be surprised if your insurance agent doesn’t have good news for you. But remember, your insurance agent is the person you should be able to count on to help maximize your airplane insurance while minimizing the cost.

AOPA Insurance Services is celebrating its twentieth anniversary. Our first policy was written in September 1993 for a Cessna 172. We want to thank all of our members for helping us become the largest light aircraft insurance agency in the United States. We look forward to the next 20 years of serving the insurance needs of our members.

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