AOPA’s Strategic Aviation Insurance Partner


Glossary of Terms


Review our glossary of aviation insurance terms to better understand your coverage.

AssuredPartners Aerospace is pleased to provide our clients with a glossary of common insurance terms to help provide clarity surrounding policy coverage, terms, and conditions. 


A-Rated Carrier - An A rated insurance carrier is a company that has received financial size and financial strength ratings from a financial rating agencies such as A.M. Best.  Ratings are used by prospective insured’s and agency’s to evaluate the ability of an insurance carrier to pay potential claims.

Accident Forgiveness - A program offered by an insurance carrier, which when specific training requirements are met, deductibles are waived with no increase in renewal premium, due to an accident, incident or claim.

Amended Coverage - To adjust, modify, or change coverage.


Bodily Injury Coverage – The physical injury, sickness, disease and, if arising out of the foregoing, mental anguish, or death of a person including damages for care and loss of services caused by an occurrence.

Bound Policy - A bound policy is temporary coverage extended to an applicant during the application process.  A policyholder may bind their coverage, and then have a set amount of time thereafter to get their application completed and their premiums paid.


Commercial Insurance - Commercial Insurance is coverage that protects businesses against property damage or bodily injury claims. A Commercial Insurance Policy allows the insured to charge for their services.

Comprehensive Coverage – Insurance designed to pay for the repair or replacement of the policy owner's aircraft in the event of damage not resulting from an accident. Term used for a variety of insurance policies providing broad protection.


Effective Date of Coverage – This is the date your coverage becomes effective upon the receipt of your premium, provided your enrollment has been approved. As long as your premiums are paid, the Master Policy is in effect, and are under age 75, you may continue to renew your coverage.

Exclusions – Aviation Insurance - Items or conditions that are not covered by the insurance contract.


Family Sub-Limits - A limitation in an insurance policy that places a maximum on the amount available to a family member of the policyholder.


Hull Damage Coverage – Protection against physical damage to an aircraft.

Hull Value – The limit for physical damage (hull damage) coverage. Also referred to as “insured value.”


Legal Defense Coverage - Protects the insured in the event he or she is sued for claims that fall within the coverage of an insurance policy.

Liability Coverage - To pay on behalf of the insured all sums up to the policy limit, which the insured shall become legally obligated to pay as damages because of bodily injury or property damage sustained by another party.

Loss of Use Coverage - Part of an insurance policy that is intended to reimburse an owner for the inability to use his or her property that was damaged by another party’s negligence.

Medical Payments Coverage - Coverage that pays medical, surgical, hospital and funeral expenses up to the applicable limit, regardless of the liability of the insured.


Non-binding – No coverage is issued and no premium paid. An application for insurance is submitted to the insurance company to find out whether or not you will be accepted.

Non-Owned Coverage - An excess policy written to cover the liabilities arising out of one’s use of an aircraft owned by another party.


Pilot Advocate - A Pilot Advocate is a person or organization who publicly supports pilots and the pilot community.  A pilot advocate pleads and defends the rights of other pilots.

Primary Policy - The coverage that goes into effect first when a policyholder files a claim.


Smooth Coverage - A limit of liability that offers a combined single limit of coverage that applies to all bodily injury and property damage claims.  A specified maximum amount can be paid out from a covered occurrence in any combination of passenger bodily injury, other person’s bodily injury or property damage.

"Split Limit" Coverage – An older type of coverage that divides the coverage limits up over multiple areas. “Split limits” appear on the policy as separate amounts (e.g. $100,000 property damage, $100,000 bodily injury, $200,000 each occurrence).


Waiver - A waiver is the relinquishment of a right or privilege.  For example a Waiver of Subrogation is the insurance company waiving the right to subrogate or recover for payments made.

Let's explore the skies and your insurance needs together.

Contact Us

Aerospace Blog

Cancelling your insurance coverage after a loss. Good idea?

Your aircraft has suffered a gear up landing. Your insurance carrier has been notified, and the repair of the aircraft is underway. You don’t have a lien on the aircraft with a bank, so you decide...

The Importance of Aircraft Renter Insurance for Pilots

Embarking on the journey to become a pilot is an exhilarating experience filled with challenges and triumphs. Flight schools play a crucial role in shaping the skills of aspiring aviators, providing...

Aviation Risk Management
Safety Management Systems for FAA Part 135 and 91.147 Operations

Risk mitigation is a natural instinct in our profession, accomplished consciously and subconsciously every day. We’ve all heard about formal Safety Management Systems (SMS). Since 2018, those...

See All Aerospace News