Liability insurance survey results

Our survey on liability insurance in force at residential airparks provided some very interesting results. We had hoped to obtain more participation but the 22 different fly-in communities represented in the survey results did give us information that should be of interest to everyone living on an airpark or considering acquiring property.

First, 77.3% of the respondents said their fly-in community did have liability insurance and the most popular level of coverage was $1 – $2.5 million. Slightly more than 70% of those completing the survey indicated that amount of coverage. Less than $1 million was in force at 17.8% with coverage of $2.5 – $5 million and over $5 million each reported by 5.9% of the fly-in communities.

Three-quarters of the airparks had maintained liability insurance coverage since the project opened while the other 25% said they had purchased coverage within the last three years.

Perhaps most significant was the fact that none of the fly-in communities indicated they had ever had an accident that resulted in an insurance claim.

Of those that didn’t carry liability insurance 80% indicated they had considered obtaining the coverage at one time or another. The cost of the insurance was the reason for not buying a policy in 75% of the situations. The remainder of the airparks without coverage declined to purchase it because they decided that the availability of insurance money might bring on lawsuits.

To better understand the type residential airparks that were represented in the survey, we asked a number of general questions, including:

How long has your airpark been in existence? The vast majority – 72.7%, reported more than 10 years. While 1-5 years was reported by 18.2% of the respondents. The rest had been in operation between 6-10 years.

How many home lots on your airpark? More than 35 homesites was reported at 40.9% of the fly-in communities while 10-20 sites was the answer at 18.2% and the same percentage at airparks with 21-35 sites.

Of those lots, how many have completed homes on them? Less than 10 lots had completed homes at 45.5% of the airparks. The other three categories each reported 18.2% completed homes.

The runway at the fly-in communities was more than 2,500 feet at 59.1% of the airparks and it was unpaved at 54.5%. The runway was not lighted at 50% of the sites.

Less than 10 airplanes were based at 36.4% of the airparks. There were 10-20 planes at 31.8%, 21-35 was the response from 22.7% of the fly-in communities and only 9.1% reported having more than 35 based planes.

Amenities at the fly-in communities varied greatly. The runway was open to the public at 55.6%, a commercial operation was conducted at 44.4%, flight instruction was available at a third of the airparks,
maintenance was available at 44.4% and fuel could be obtained at 22.2% of the airparks. A restaurant and golf course were available at 33.3%; equestrian center was reported at 22.2%, as was a clubhouse. Only 11.1%
of the properties had a swimming pool.

Half of the fly-in communities for which we received a response were located more than 35 miles from a city of at least 100,000 people. Respondents claiming their airpark was 21-35 miles from a big city were 18.2%; 10-20 miles came in at 9.1% and less than 10 miles from a large city was reported at 22.7% of the airparks.

Perhaps the most important results of the survey were the names of insurance companies or the insurance agencies that were instrumental in providing the coverage. Here are their names (some are actually the insurance companies while others are the agents that the different airparks worked with):

  • American National Property & Casualty / Phoenix Insurance Group
  • US Specialty Insurance Co., Dick Levin
  • Falcon Insurance of Alaska
  • W. Brown & Associates
  • Air Capitol Insurance LLC
  • Chubb
  • AIG Aviation
  • Southwest Aviation Insurance Group
  • Aircraft & Marine Assurance Agency Inc.
  • Philadelphia Insurance Group
  • Costello Insurance
  • Wells Fargo Aviation Specialty Group

We do not have the locations of these firms but suggest they can be obtained through a web search.

There were also a number of comments submitted.

“The runway and partial parallel taxiway are owned by the developer who has a $10 million insurance coverage. There is a golf course and restaurant on the developer’s property and isn’t associated with the
homeowner’s association.”

This same respondent indicates they received a $3,000 quote for liability insurance not including residential taxiways. They declined because of the price.

Another airpark reported a $2,000 premium for their coverage. It has been that rate for five years but was raised to $2,250 this year. “We feel we need the coverage but think the premium is too high and we don’t really know if we have the ‘right’ amount.” This airpark has been around over 10 years but has less then 10 completed homes. They have coverage of $1-$2.5 million.

Several respondents indicated they require property owners to sign a release putting the risk on the participant, not the airpark. Others reported requiring a user waiver and indemnity release for airport users.

No one answer fills all the needs. Hopefully this information will help you and others at your residential airpark come up with the solution that best fits your needs.