Industry News

February 2019 Issue

Insurance Update: A Hardening Market

The 10-year run that favored buyers of aviation insurance is coming to an end. Be an attractive risk by flying and training frequently.

Beginning in 2010, there was a further influx of companies starting their own aviation divisions. These included Travelers, SwissRe, QBE, Hallmark, XL Catlin, Great American and W.R. Berkley. General aviation did not grow much in that time, so by 2016 there were a lot more insurance dollars chasing each airplane and helicopter than there had been 10 years before. The market was awash in what insurers refer to as "capacity." Capacity is basically the capital required for insurers to set aside as reserves as they take on the risk that comes with new insurance policies. As the new companies entered the market, the legacy companies, including USAIG, Global Aerospace, AIG and Old Republic (Phoenix), were forced into a defensive position in order to maintain their market share against the new invaders, and we were off to the races.

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