Why Flight Instructors Should Purchase a Non-Owned Liability Insurance Policy
    12/16/2019

    As a flight instructor, chances are you will live a long life, fly thousands of hours and instruct hundreds of students who go on to have many years of accident free flying. Unfortunately, aircraft are occasionally involved in accidents and flight instructors are blamed.  Students and/or other third parties may even file a lawsuit against the flight instructor seeking monetary damages.  Importantly, the non-owned insurance policy also covers the costs and expenses associated with defending you in court.  Consider the following to help you build a solid risk management plan as it relates to your flight instruction business.

    • Build Solid Documentation: Regardless of the type of instruction you are providing, documentation is critical to create a history of what actually happened.  The Federal Aviation Regulation 61.189 provides a minimum standard of what flight instructors must document:
    1. Signing the logbook of each person to whom the instructor has given flight or ground training
    2.  Maintain a separate record of each student the instructor has endorsed for solo flight, the date of the endorsement and anyone who you have endorsed for a knowledge test or a practical test. The record must contain the kind of test, date and the results. Going above and beyond this MINIMUM requirement will help defend you in the event of a lawsuit
    • Keep Your Records for More than Three Years: No one knows what the future will hold, but luck always favors the prepared.  Keeping records longer than the minimum requirement will certainly come in handy if a lawsuit is filed against you.  By exceeding this basic and minimum requirement, you will also build your credibility as an operator who will go above and beyond.
    • Make Notes on Every Flight: Keep accurate records of any ground instruction given and what topics you covered.  Consider using an electronic platform to capture more information and make recordkeeping more accurate and less cumbersome. There are some third-party vendors who provide platforms specifically designed for Part 61 or Part 141 flight training operations. 
    • Taking a Video of the Flight: Many areas of society have seen the benefit of “video tells no lies” – the video review can also enhance the training experience by allowing the student to review their lesson if the data can be made available to them. If something does go wrong during the flight, or years later, you have undisputable evidence of exactly what happened.  Video is not just risk management, but value-added service.  Many other instructional services use video to enhance their product (golf instruction, driving schools, etc.) so why not flight instructors?
    • Transfer Your Risk: We encourage any flight instructor who is providing services to an aircraft owner to secure through the aircraft owner’s policy, an additional insured endorsement and a waiver of subrogation.  This will provide an initial layer of coverage if something goes awry during the flight.  As an additional insured in the owner’s policy, you are afforded certain coverages in the event a third party makes a claim against you.  The waiver of subrogation precludes the owner’s insurance company from making a claim against you for damaging the aircraft.  
    • Insure Your Risk: A non-owned aircraft liability policy covers your legal liability arising out of the use of a third party’s aircraft.  If you are sued, the insurance company has two basic responsibilities:
    1. Defend – which means hiring an attorney, and experts if needed, to protect your legal interests in the matter 
    2.  Indemnify – if you are found negligent then the insurance company will pay those sums which you are legally obligated to pay, up to the limit of liability in the policy. 

    If you are employed by a flight school and the flight school has insurance, then you are likely covered by their policy for flight instruction given during the course and scope of your employment with the flight school.  If you elect to provide flight instruction outside of your employment with the flight school, then you will need to consider your own insurance coverage.  You may only provide a flight review or an IPC to some select clients outside of your employment. In these cases, the flight school will not be able to help and you will need your own policy to defend you, or slug it out on your own, which again may really put a damper on your pocket book. 

    Knowing the Law and Dealing with It
    Generally, the courts will not hold an educational facility liable for the training they provide.  As an example, universities are not sued for their graduate’s liability.  How would society ever be able to function if a learning institution could not train doctors, nurses or other professional trades such as engineers?  Outside of a university, professional flight instructors are just that – a for-hire business, therefore some courts have allowed lawsuits to move forward as it relates to a for hire flight training institution.

    There are ways to protect yourself and your future.  Documentation, record retention, transferring your risk, and insuring your risk are just a few measures you can take to shield and build your empire. AssuredPartners Aerospace is available to assist with all your questions regarding non-owned hull and liability insurance coverage.  Reach out to an AP Aerospace specialist for help through the insurance process to determine how best to protect yourself.
     

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