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@#$@#$!!! Insurance?


marbleturtle

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Another old topic I'm sure... but things seem to be changing on a daily basis. Also I just read on John Slade's website that he is having problems getting insurance. :mad: So here goes...

 

1. What insurance is required?

 

2. Is it possible to get simple liability coverage (no hull) on an auto conversion engined experimental?

This ain't rocket surgery!

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>1. What insurance is required?

As far as I know, none other than what's required by you're hangar lease or FBO tie down etc.

 

>2. Is it possible to get simple liability coverage (no hull) on an auto conversion engined experimental?

Yes. Lots of people have it.

 

Incredibly, they consider such things as time in type, total time, rating, engine type & installer, transision training planned, etc. etc. when they decide on NON MOVING GROUND LIABILITY, no hull. The "explanation" I got was that they use the same criteria for all levels of insurance on the basis that once they write you, they can be held liable for anything.

 

One thought I've had on liability insurance is that it make you a target for contingency fee lawyers. No insurance, no attackable assets = not worth suing.

 

Also, before taking out life coverage through Harvey Watt, the EAA recommended company, check out the wording of the policy. It seems it doesnt cover flying in EXPERIMENTAL planes. Duh!

 

No offense to our resident Cozy building attorney, but personally I'd line up the the insurance executives right there alongside the lawyers on "judgement day". At least most lawyers know how to make money. These insurance people dont have a clue how to assess risk.

 

If anyone wants to read the currently unfinished saga, it's at the end of http://kgarden.com/cozy/chap27.htm

I can be reached on the "other" forum http://canardaviationforum.dmt.net

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Well my problem will be 0 hours in type (unless you count Greg's jet Cozy in a few weeks) and training hours in a C172 (newbie pilot). I forgot to log my 4000 hours playing Flight Simulator and X plane! I could spend $4k getting my hours up over 100, but that won't help me in "type". If I had no assets to go after... I'd say screw it and continue.

 

I'm covered on life insurance.

 

All I want is the liability coverage. If I bash up the hull... I'll just build another (its faster the 2nd time around... right?).

 

So I guess my question is... do you think am I going to be able to get liability with the rotary engine conversion or will I need to stick with a certified engine to have a better chance of getting insured? Say it ain't so! :(

This ain't rocket surgery!

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Its frustrating to know that my life insurance (throught work) covers anything except suicide and flying. It covers rock climbing, boat racing, farming, marriage, skydiving.... I guess insurance companies consider us all suicidal. We're not even covered while we're in the company helicopter!! (at least not w/ our supplemental) I did a search last month and did come up w/ a quote for $250k 10 yr term, $19/month. Told em I had 25 hrs in Tampico TB-9, still training. I didn't ask about experimental. (yet). Keep pushing John, you're breaking new ground here (or so it would seem).

Andrew Anunson

I work underground and I play in the sky... no problem

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It's been my understanding that most states (37 of 50 last time I checked) demand that the owner of flying aircraft carry at least $100,000 liability coverage. This was a fact that was well reported at SNF 2001. Liability insurance is relatively inexpensive. My next-door hangar mate's liability insurance runs approximately $500/year? Better check with you state before leaving mother Earth.

 

...Wayne Hicks

Wayne Hicks

Cozy IV Plans #678

http://www.ez.org/pages/waynehicks

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First, the blanket condemnation of attorneys is at best a very lazy way of thinking of the issue, IMO. In this case based on what seems to be an obstinate desire not to plan. It is easy to feel smug concerning lawyer bashing but I wish you would think better of it. With the joy of aviation comes some responsibility.

 

Now, that I have not let the stray comment go by, and defended a profession I am proud of, I too resent the problem of obtaining insurance (I think the litigation threat is often used as an excuse to justify overcharging...can we say lyc). It is true that if you don't have money or assets you may not be sued. Unfortunately, you may be sued anyway and defending a suit can be expensive. However, it is easier to get a judgment then to COLLECT on a judgment.

 

I don't litigate. Part of my practice is to help folks plan and protect their assets from the "federal mafia" and creditors. There are steps you can take BEFORE there is a problem to limit your liability. Please note that I said limit, not remove and plans MUST be done before there is a problem. Like most planning, it does you no good unless you take action. I would suggest seeking out a local attorney (I am licensed only in Texas and can only give advice for Texas) who focuses in this area....even if you hate all of us. They may be able to keep your ass somewhat protected despite your lack of respect for what we can do.

 

It is my understanding that you cannot really diminish your responsibility as PIC, but you should be able to protect your assets through proper planning. I encourage you to explore what can be done and not gripe about how disadvantaged you are...gee wiz, you are building an airplane. If I were not doing the same thing, I would be jealous <g>. Yeah, it may cost a little, but please, do not step over a dollar to pick up a dime. You may choose to do nothing, but at least you do so in an informed manner.

 

Remember too, that as a rule, liability insurance is to protect those you may really hurt or damage, asset protection (and hull insurance) is about protecting and replacing what you have. It is a personal matter whether you care about helping those you hurt. Often litigation in this area may be by a grieving widow who does not know who else to attack in a time of grief and desperation. Logic may not rule.

 

Sorry, for the rant and I hope I am not alienating y'all, but if I don't speak up I am undermining myself. Also, this is an area I know something about. All you engineers usually just enlighten me maybe I can give some insight as to asset protection.

 

I would not blame all engineers for the shuttle disasters. Yeah, the bad news makes much better press and we usually hear about the abuses.

 

Planning is like a parachute, you may only need it once, but it had better work.

 

All the best,

 

Chris

Remember, amateurs built the ark, professional built the Titanic

 

"shields up"

Christopher Barber

Velocity SE/FG w/yoke. Zoom, zoom, zoom.

www.LoneStarVelocity.com

 

Live with Passion...

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<... you may be sued anyway and defending a suit can be expensive ...>

About how far into a suit is "discovery"? Like, if'n I get sued, how much money will I have to spend before the opposing lawyer finds out to his satisfaction that I don't have anything worth him taking it away from me? How far along in the process does he learn that I'm indigenous and that my only asset was my airplane which is no longer an asset?

 

Just wonderin ... Jim S.

...Destiny's Plaything...

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Actually, an attorney should know this BEFORE he ever started a suit. Even with all the stories out there, most attorneys(I said most, not all <g>) will discourage a suit if it is not valid or even if it may be valid but there is nothing to recover. This is one of the reasons the insurance companies sponser organizations like "Citizens against Lawsuit Abuse". Because, as a rule, insurance companies have very deep pockets and are worth going after. The more negative impressions about lawsuite abuse the better for them. Of course, with all the talk about tort reform, they fail to mention that "frivilous lawsuites" are already against the law and are usually thrown out of court and sanctions can be impossed. In most insurance policies, it is their responsibility to defend, not yours (and their decision whether to settle).

 

However, if you don't have insurance it is on your shoulders. But, if you have nothing, this should be known. The attorney can't work for free (not greedy...I have a student loan to repay...ok, and an airplane to build ;-). I don't think most of y'all would work for free either) and if there is no ability to get a recovery there is NO contingent fee. If there is no possibility for a fee from the recovered amount the plaintiff must pay for everything up front (filing fees, court cost, evidence production, attorney projected fees, etc). This in itself may be cost prohibited for the potential plaintiff. Of course, you are allowed to represent yourself (plaintif and defendent, but only yourself, not you spouse etc), but you must obtain the same level of knowledge of the rules as an attorney (except in small claims court which is limited to $5000 or below in GSOT)

 

There are some opinions that if an attorney sues an entitity that is structured for asset protection and that attorney did not realize that the asset protection was in place, that attorney may be liable for malpractice. He/she should have know that statutes limited the recovery potential. Be aware, this is a GROSS oversimplification

 

There are structures that even if you get sued AND THEY WIN, you do not pay out the money and THEY have to pay taxes on the money you never gave them. Pretty good deterent, huh? It can lead to no action being taken or a settlement for pennys on the dollar. Again, this type of planning must be in place before the problem developes.

 

Just some FREE legal insight (remember, you get what you pay for) <g>

 

If I understand it correctly, there is another meaning for the initials "CYA" other than "Call Your Attorney" ;-) FWIW.

 

All the best,

 

Chris

Christopher Barber

Velocity SE/FG w/yoke. Zoom, zoom, zoom.

www.LoneStarVelocity.com

 

Live with Passion...

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There are two seperate problems with insurance

 

 

Claims made for things the builder should fix himself.

 

OK so you do a nosewheel gear up landing, just dam fix it, to hire a fixer is silly expensive and that is what is often done

 

Jury awards

 

My close friend investigated acccidents for 25 years and went and testified for 25 years and with absolutly no evidence that there was a fault of the manufacturer, the jury gives the family a huge award. Like the parker hanifin vacuum pump award, the ntsb says the instruments were working and the jury gives a huge award to the family. the cesna box canyon afair with the seat belts, hello

 

we are planning on just liability insurance and will self insure the rest, we will also have a corp own the plane.

 

enjoy the build, see i didn't blame the attorney

 

mike

maker wood dust and shavings - foam and fiberglass dust and one day a cozy will pop out, enjoying the build

 

i can be reached at

 

http://www.canardcommunity.com/

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These are interesting comments, and it appears that everyone will not borrow a dime to complete the a/c. Does anyone have any experience with what lenders require for coverage? For example if you borrow $20,000 to finish and install your dinosaur on the tail end, what coverage will be extracted? I don't plan to borrow, but it would be nice to know what the options are if I desire to accelerate the purchasing part of the project. Anyone have any experience with Banks?

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For example if you borrow $20,000 to finish and install your dinosaur on the tail end, what coverage will be extracted?

Dave, This will be little help.........but I plan to borrow just enough for my engine towards the end of the project. I will borrow on my name instead of the plane, or perhaps put it on a low interest Crdit card.

 

See.........I told you this would be no help. Just a thought.

Joseph@TheNativeSpirit.Net

I am Building a Jo-Z IV StarShip.

 

What Do YOU Want?

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For those who'd like to follow this saga, there's an update on my website, http://kgarden.com/cozy/chap27.htm#MoreInsurance

 

In summary, I'm assured that the life policy IS valid for flying Experimentals, and work continues on getting ground liability coverage.

 

I've been asked to collect data of currently insured automotive installations, so if you're flying an automotive (especially a Mazda) and you have coverage, please let me know name, level of coverage, underwriter, model, type, engine etc.

I can be reached on the "other" forum http://canardaviationforum.dmt.net

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Mike (Dust),

 

Thanks for not blaming the Lawyer. IMH, and biased, Opinion, blaming the lawyers for lawsuit abuse, is akin to blaming the gun for murder...someone else had to decide to do the deed. Yeah, biased.

 

Often, many of the issues with juries is they do not make awards based on facts, but based on emotions and sympathy for loss. This can weigh things heavily towards widows etc and against corporations with seemingly deep pockets.

 

Also, many folks see the court system as a lottey.

 

I do think placing the plane is some sort of "intity" is not a bad idea. Something a simple as an LLC or Corp. to more complex structures such as an LP with a LLC general partner (consult local consel as state laws vary). Even a few/several intities to segregate assets can have significant advantages depending on your circumstances. Again, this is EXTREMELY oversimplified and may have unintended consequenses (like taxes) but, it must be done before a proplem AND you must be sure to continue to observe the "corporate formalites". If you don't, the plan can usually be easily attacked and you lose your protection. Also, you still may have to "sign" in an idividual capacity despite the corp structure to satisfy others (such as securing a loan).

 

As to what insurance companies, their requirments or usually policy, not law, but can be just as restrictive. Much of what I do is to satisfy third parties (insurance companies, brokerage houses etc), not laws. FWIW.

 

 

Again, thanks for not shooting the messanger

Christopher Barber

Velocity SE/FG w/yoke. Zoom, zoom, zoom.

www.LoneStarVelocity.com

 

Live with Passion...

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<... many of the issues with juries is they do not make awards based on facts, but based on emotions and sympathy ...>

I think more important is the makeup of the jury. In this country, anyone who can read and write and count to twelve OR has a steady job, can find a way to beg off of jury duty. That leaves lonely housewives and the chronically unemployed in the jury pool. Jury duty is a lot like parenthood in that they are both critically important to the nation, and yet have NO prerequisites. You cannot be ignorant or stupid enough to be disqualified from these endeavors. It's scary as hell considering how much we all have riding on these activities.

...Destiny's Plaything...

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I have been contemplating a rotary engine, however; after reading Somebody's web-page about the problems with insurance on a Cozy w/a Rotary......mixed with an e-mail from anothersomebody ....Me thinks that Mr. Nat P. had a GREAT idea.

 

As of today, I will start looking for a Lyco??????What size???? Should I use a Turbo on it??????If iI use a turbo,.....Must I have a CS prop?????????

 

I feel like I am getting somewhere.

Joseph@TheNativeSpirit.Net

I am Building a Jo-Z IV StarShip.

 

What Do YOU Want?

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I have been contemplating a rotary engine, however; after reading Somebody's web-page about the problems with insurance on a Cozy w/a Rotary......mixed with an e-mail from anothersomebody ....Me thinks that Mr. Nat P. had a GREAT idea.

 

As of today, I will start looking for a Lyco??????What size???? Should I use a Turbo on it??????If iI use a turbo,.....Must I have a CS prop?????????

 

I feel like I am getting somewhere.

Joseph@TheNativeSpirit.Net

I am Building a Jo-Z IV StarShip.

 

What Do YOU Want?

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Yeah, I guess I feel if I don't say something, it is as if I agree or conced the point. Kinda like the tech guys do when they disagree with and engineer issue or a progammer on a "pesonal confuser" point. I hope I don't come off as rude, just convinced <g>.

 

Oh, feel free to call me Chris.

 

All the best,

Christopher Barber

Velocity SE/FG w/yoke. Zoom, zoom, zoom.

www.LoneStarVelocity.com

 

Live with Passion...

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Chris,

 

In no way do I think you were rude.........I was just jabbing in dark.

 

 

I feel if I don't say something, it is as if I agree

 

I know what you mean,It is exactly that..................Keeping quiet is the same as agreement.

Joseph@TheNativeSpirit.Net

I am Building a Jo-Z IV StarShip.

 

What Do YOU Want?

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I have been contemplating a rotary engine

I would respectfully suggest that this is a bad idea for someone just starting the build. I would also suggest that considering (or worse, buying) a Lycoming is a bad idea too.

 

The playing field is changing. My advice is get on and build the airframe and give little thought to which engine will power it until the last possible minute. In 3, 4 or 5 years the situation will have changed. That much is certain.

 

Perhaps rotary and/or subaru powerplants will have proven themselves. Perhaps not. There might be a reasonably priced diesel available (dont hold your breath). Perhaps insurance will be easier, or harder to get. Maybe the available fuels and/or prices will have changed.

 

To anyone just getting started I say don't even think about it. Keep in touch with what's going on, but save you're decision until you're airframe is complete..... then examine the issues as they stand at that time with respect to performance history, cost, insurability etc. etc.

 

PS - So far I've collected info from two insured rotary flyers with a total of over 900 hours and zero claims.

I can be reached on the "other" forum http://canardaviationforum.dmt.net

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I would respectfully :D disagree with John. Although I am just setting up shop, while John is almost flying, I think some considerations can be made ahead of time and simplify building.

 

John, if you decide ahead of time to build a rotary (or whatever), won't that help with plumbing and other decisions instead of back-tracking and reconstruction?

This ain't rocket surgery!

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Yea, ok. Point taken. Give it some consideration, but dont finalize the decision. Put in a few extra AL pipes down the heat duct if you like. They can always be used for a seperate liquid cabin heating system, or oil, or not used at all. Add EFI return lines to the tanks. You can always cap them. Other than that, and I'm sure you get my point, leave the DECISION until the latest possible moment when the latest information is available.

 

Whether you end up fitting a 13B, a Lyc, a Subie, a V8 or a Diesel, the basic build doesnt (and shouldnt) change very much. If you're going to stick a turbine on it, then some serious redseign is needed, but even that can be done afterwards as proven by Greg. The closer you can keep the airframe to stock, the better, so my point was build the plane. You're much more likely to finish if you just get on with it as detailed in the plans. Changing things later is actually a lot easier, because you'll be an experienced epoxy guy by then.

 

In a couple of years you'll be able to go to my website and others and know if the rotary is a good idea. If I'm flying fast and happy with full coverage, join me. If not, go a different direction.

I can be reached on the "other" forum http://canardaviationforum.dmt.net

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