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Article as appears in In Flight USA, May 1999, by Jack Ronson

What You May Not Know about Your Current Policy

Let's face it. Buying life insurance is about as much fun as taking a check ride. However, just as a biannual flight review sharpens your skills, if you are willing to take a few minutes and review your current life insurance policy, you may find some interesting things that can save you some money and provide you with a better policy.

The first thing to do is to look for any waivers and riders on your current policy. Check whether they are related to aviation in any way. Generally speaking, the older the policy the more likely it contains some kind of aviation exclusions. Many pilots are shocked to find out they have an Aviation Exclusion Rider attached to their policy, which makes the policy null and void if they die in an aviation-related accident.

Second, check your rate and compare it to rates currently being charged in the marketplace. In general, life insurance rates have declined by as much as 40 percent over the past several years, and chances are you can save substantially over what you are paying for your current policy. In fact, a price war of sorts has been going on among many of the term life companies. A policy written today will not only provide better premiums, but also better conversions from Term Plans to Permanent Insurance.

Finally, deal with a life insurance company that knows aviation and knows how to write a policy for a pilot. Historically, pilots have had to pay more for their policies because insurance companies, in general, view aviation as a "high risk" profession or pastime. If your insurance company doesn't know the difference between an aileron and a rudder, then chances are you are paying premiums that are based on tables created in the days of the Wright brothers. Several insurance companies have discovered that pilots are actually a group worth courting. Pilots tend to be healthier than the general population, and they see a physician on a regular basis. They are also well educated and have higher incomes than average. These are positive factors in the underwriting of life insurance, and they balance out the risk factor of flying in most cases.

There are many war stories about insurance agents who will initially quote you a rate from their general rate tables and later find out that their carriers can't write it for this rate because you are a pilot. This can be very frustrating, because chances are you made it very clear up-front that you are a pilot. But because they don't write pilots very often, they discover late in the game that what they initially quoted you was way off base.

A few insurance agencies specialize only in aviation, and some are even staffed by pilots. These agencies have policies for almost any pilot, from student pilots and flight instructors to agricultural pilots and experimental aircraft owners. Two agencies that are particularly savvy about aviation are the Pilot Insurance Center located at the Addison Airport in Addison, Texas, and Falcon Insurance Company in Austin, Texas. In addition to individual policies, these companies can write group policies for pilot organizations as well as company benefit plans.

Ask Hal Cunningham, a high-time commercial and private pilot. Cunningham spends most of his flight time logging hours in the right seat of a 747. However, on the weekends, he likes to fly cross-country with his wife in their Cessna Turbo 210.

"Recently, I conducted my own insurance review and found that I was in need of additional coverage," Cunningham said. "As a 52-year-old pilot, I was concerned about having to buy a policy that was greatly encumbered with exclusions. That's when I went on the Internet and tried to find a company that knew aviation and understood how to write a policy for a pilot."

With more than 15,000 hours in his log-book, Cunningham is as thorough about checking out insurance companies as he is about pre-flighting his aircraft. He said that after doing a Web site search, he discovered a couple of companies that specialized in writing policies for pilots.

"There are several good insurance companies that are responsive to your needs as a pilot," Cunningham explained. "However, one stood out among the rest. The Pilot Insurance Center seemed to be the most intuitive about my needs. They bent over backwards to help me get the policy I wanted and made it so easy. In addition, they were able to save me some money. Also, they were able to write a good policy for my wife, even though she is not a pilot."

At the other end of the spectrum is Alan Heidt, a 44-year-old insurance agent from South Dakota who recently learned to fly to he could better serve his customers in his territory - North Dakota, South Dakota, and Minnesota. With just 40 hours logged, mostly in a Cessna 152, he looks forward to the time when he can get around to seeing his customers in a more efficient matter.

"Mostly I write property and casualty insurance for the trucking industry," Heidt said. "Being an insurance agent, I didn't really think it would be a problem finding a company to write life insurance for a low-time pilot. However, much to my surprise, it was tough to get hold of a company that even understood my situation, let alone provide a quote."

Heidt began to use his insurance connections to do a search for a company that could help him out. He also bought his policy from the Pilot Insurance Center.

"My advice to low-time pilots or pilots who fly only occasionally is to find an insurance company that speaks your language," Heidt suggests. "Not many companies understand aviations and will attempt to write a policy that will often include an aviation exclusion and charge outrageous premiums. I also feel it is important to work with an agent who is a pilot, because they usually understand the process and nuances of underwriting for a pilot. The really good companies don't waste your time. They are competitive, and chances are they can save you money."

The next time you are scheduled for a biannual flight review might be a good time to review your life insurance policy as well. The time you spend could result in a saving of dollars and add greatly to your peace of mind. You can find several agencies that specialize in life insurance products for pilots on the Internet or in advertisements in aviation publications.

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