The importance of a condition |
Mitchell was the pilot of a Cessna 414 carrying two passengers when it crashed, killing all occupants. Potter owned the plane and permitted Mitchell to pilot the craft because, based on the information provided to Potter, he was considered a professional pilot. U.S. Specialty Insurance Company declined Potter's claim when presented because based on the pilot's logged hours condition, Mitchell was not qualified to pilot the craft. Potter argued that based on Mitchell's background he was well qualified while USSIC argued that the hours-logged condition applied and continued to deny the claim.
Click here to see how the courts decided when asked to consider whether Mitchell was a covered pilot at the time of the loss.
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What are conditions? |
The condition section of a policy can often be overlooked until a loss occurs. While the named insured might not consider them particularly important, the insurance company considers them vital and will enforce them. An often-overlooked condition is vacancy and occupancy. The condition explains exactly when the insurance company considers a building vacant. If it is vacant for more than a set number of days, coverage is void for vandalism, sprinkler leakage, breakage of building glass, water damage, theft, or attempted theft. If any other perils cause the loss, the damages are reduced by 15%.
Click here to read the PF&M explanation of the Vacancy and Unoccupancy Condition in the ISO Commercial Property Coverage Forms.
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Aircraft coverage is unique |
Aircraft coverage was modeled after ocean marine coverage but it has developed into a product unlike any other. The emphasis is on the specific aircraft being covered and the pilot's ability to handle that specific craft. There is no assumption that because a pilot can handle one craft that he or she will be able to handle another. There is no general "permissive user" coverage for non-owners who are operating the craft even if being done with full knowledge and approval of the owner.
Click here to review PF&M's analysis of aircraft coverage forms.
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Coverage is available |
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The good news is that there is a very robust market willing to write almost any aircraft provided the pilot can meet FAA qualifications and training requirements in operating the aircraft.
Click here for a list of MGAs and carrier interested in writing aircraft coverage in the state of Indiana.
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