Flight departments evolve continually as organizational needs shift. They acquire aircraft, onboard crew members, relocate operating bases, fly into new territories and adapt operations to support updated business goals. However, these changes can affect the organization’s aviation insurance coverage. Fortunately, aviation insurers, like Global Aerospace, take a long-term partnership approach that adapts well to changing needs.
Flight departments should consult their aviation insurance broker and open a discussion regarding significant changes to aircraft, pilots, operating locations, geographic areas, aircraft use or mission profiles before implementing the change. A conversation with an insurer can help them understand whether the change will produce new risks or amplify existing ones. If so, they can determine what changes will be necessary to maintain adequate coverage.
Of course, not every operational change requires a policy modification or coverage enhancement. Still, having discussions before changes take place can help ensure that the organization maintains adequate protection.
Why Should a Flight Department Tell Its Insurer About an Operational Change?
Your flight department should discuss significant operational changes with your aviation insurer because changes in aircraft, pilots, locations, mission or operating practices can affect the risk being insured and may affect coverage, underwriting or policy terms. Aviation underwriters look at risk holistically, taking many factors into account: aircraft type, crew qualifications, operating locations, maintenance programs, passenger exposures and geographic flight patterns.
When any of these parameters change, the risk profile potentially evolves as well. Proactively contacting your insurer gives their underwriters the context needed to assess the situation accurately. As a result, your flight department can avoid complications down the road.
What Operational Changes Should Flight Departments Tell Their Insurer About and Why?
Tracking operational evolution requires deliberate oversight. Here are eight common flight department operational changes that warrant an underwriting review:
1. Adding or Replacing Aircraft
Does adding a new aircraft require notifying the aviation insurer? Yes, it does. Whether you are adding to your fleet or replacing an existing aircraft, early coordination with your insurer is essential. A new model introduces different hull values, performance parameters and operational capabilities. Securing coverage before delivery ensures that hull values and liability limits are established prior to the maiden flight.
2. Adding or Changing Pilots
Should you tell your insurer when you add a new pilot? Crew changes represent one of the most critical elements of aviation underwriting. Whether you bring in pilots from outside your organization, promote first officers or hire contract pilots, you should discuss potential changes to your flight department’s insurance policies with your insurer. Underwriters are interested in a pilot’s flight time, type ratings, training history and other factors.
3. Changing the Aircraft’s Primary Base or Operating Location
Does changing the aircraft’s primary operating location or adding another operating base affect insurance? Yes, it does. Relocating a home base or adding another changes the risk your department faces—both ground-related and airborne exposures to a new geographic area.
Specifically, underwriters look at things like local weather patterns, the presence of gusty or prevailing winds, hangar security, runway infrastructure and ground services. Operating from a coastal airport with seasonal hurricane threats or a mountain valley presents different challenges than an environment with stable weather and an airfield surrounded by flat terrain.
4. Expanding the Geographic Area of Operations
Extending the reach of your operations, even if you do not add new bases, can affect your insurance needs. For instance, adding international destinations brings up unique navigational and regulatory challenges.
Additionally, operating in remote regions or areas facing geopolitical issues and instability might require evaluation and new policy conditions suited to the change in exposure.
5. Changing How the Aircraft Is Used
Can changing how an aircraft is used affect aviation insurance requirements? Yes, the same aircraft can present a different insurance risk depending on how it is operated and who or what it is being used to transport. Shifting from traditional executive transport, for example, to customer shuttles, air ambulance services or cargo carriage changes passenger and cargo liabilities.
6. Changing the Type or Frequency of Operations
Destination and cadence changes are additional reasons to share details with your broker and insurer. Significantly increasing annual flight hours, shifting to frequent late-night legs or landing regularly at more challenging destinations shifts the baseline risk. Telling an underwriter about these changes ensures that your coverage aligns with your exposures. Importantly, gradual modifications are just as important to discuss as sudden transformations, and they may be more difficult to identify.
7. Changing Maintenance or Operational Practices
Switching to a new maintenance service provider or bringing those activities in-house can affect your aviation insurance coverage. So can changing inspection schedules or altering a major maintenance agreement. Consequently, contacting your insurer in advance of these changes is crucial.
8. Changes in the Management Team or the Flight Department Structure
In flight departments, effective “management of change” is essential. That includes communicating operational modifications to your insurer. Whether you have named a new director of aviation, promoted someone to a chief pilot role, experienced significant crew turnover or outsourced any of your operations, your insurer will want to be kept up to date.
What Information Does an Aviation Insurer Require To Evaluate an Operational Change?
When presenting an operational shift to your insurer, prepare a summary answering these questions:
- What is changing?
- When will the change occur?
- Why is the change being made?
- Which aircraft are affected?
- Which pilots or crew are affected?
- Where will the aircraft operate?
- How will the aircraft be used?
- How frequently will it be flown?
- What new airports or countries are involved?
- What training or qualifications are required?
- Are new vendors or service providers involved?
- Are there changes to maintenance arrangements?
- Is the change temporary or permanent?
When Should a Flight Department Notify Its Aviation Insurer of an Operational Change?
For flight departments, risk management is a core competency. That must include contacting your insurer about modified operations, and that conversation should always occur before the change takes place.
Giving your insurer advance notice provides adequate time to review aviation insurance operational changes, ask clarifying questions and process required endorsements.
Can Delayed Communication With Your Aviation Insurer Cause Problems?
In a busy flight department, explaining operational changes to an insurer is a task that might get pushed to the back burner. However, delayed notification can leave your policy out of sync with your actual operations.
Proactive communication helps keep your coverage intact and claims resolution straightforward and more predictable as it meets expectations.
Frequently Asked Questions
Do flight departments need to tell their insurers about all operational changes?
No, they do not. Aviation operations are dynamic and some changes (minor modifications of routes, for example) typically do not need to be reported. However, significant departures from your baseline policy application (such as adding aircraft you have not previously used) should always be reviewed. When in doubt, it is a good idea to reach out to your broker and ultimately your insurer. They can quickly determine if the change necessitates policy adjustments.
Can changing an aircraft’s home base affect corporate aviation insurance?
Yes, it can. Operating from a region where severe weather is common or an airport with limited hangar space can directly affect risk and, as a result, your insurance needs.
Should you contact your insurer when expanding your operations to include international flights?
Yes, you should. Flying into foreign airspaces or distant regions often requires territory revisions, additional war risk policies and regional liability endorsements.
Keep Your Aviation Insurance Aligned With the Risks You Face
Making communication with your aviation insurance broker and insurer a standard part of management-of-change workflows ensures that related risk exposures are understood by all involved and compliant with policy provisions. Transparent, early discussions allow underwriting teams to stay informed regarding changes in operational exposure to better meet the unique needs of your flight department.
About Global Aerospace
Global Aerospace has a century of experience and powerful passion for providing aviation insurance solutions that protect industry stakeholders and empower the industry to thrive. With financial stability from a pool of the world’s foremost capital, we leverage innovative ideas, advanced technology and a powerful synergy among diverse team members to underwrite and process claims for the many risks our clients face. Headquartered in the UK, we have offices in Canada, France, Germany and throughout the United States. Learn more at https://www.global-aero.com/
Global Aerospace Media Contact
Suzanne Keneally
Vice President, Group Head of Communications
+1 973-490-8588
