Liability vs. Life

When insurance gets really important

Everyone is familiar with the terms liability insurance and life insurance, but just how do those terms apply when there is a loss?

You and your bank president passenger are day VFR over the Shenandoah Valley of Virginia when your engine swallows a valve. You respond with the well-practiced skill of a professional aviator and put your airplane down in a hay field with nary a scratch. Great. Under such circumstance neither bodily injury liability nor life insurance should come into play, but what if it had been dark, or if you had been 50 miles farther west? If so, you might well have been dealing with issues of liability and life insurance.

If, as the aircraft owner, you carried liability insurance of $1 million each occurrence with a $200,000 per passenger sublimit, and your bank president passenger was injured or killed, your insurance company could either defend you, try to settle the claim of the injured passenger up to $200,000, or do a combination of both. This protection is premised on the idea that the pilot was legally liable for the injury, and that the insurance company was responding to that claim. Are you sure you checked that oil? Had there been “issues” with that valve before? Remember, it could be up to the courts to determine if there was negligence.

So what if you are injured or killed? If your policy provides “Medical Payments - including crew,” you might receive a small payment (usually $5,000), but unless you carry life insurance or accidental death and dismemberment (AD&D) that does not have a general aviation aircraft, pilot, or crew exclusion, you would likely receive nothing. Some life insurance companies allow you to buy-out this exclusion; others will not. Be sure to check your policy. Your AOPA life insurance program has no aviation exclusions, and coverage is available for up to $1 million. AOPA members can also add up to $300,000 of AD&D insurance regardless of pilot experience, and can add dependent family coverage for your spouse or unmarried children under age 25. If you are currently enrolled in the AOPA AD&D Plan and would like to change your plan, increase your benefit amount, or have questions, call AOPA Insurance Services at 1-877/432-AOPA [2672].

Visit or call 800.622.2672 for loads of information on how AOPA can get you the best deal for your insurance needs.