Territorial Limitations - Aviation Insurance & Risk Management ...

My past articles have cautioned many times that you should
never assume all aviation insurance policies are the same.
The fact is, they are very different. Even different policy forms
issued by the same company can have great variations in coverage.
We have advised that you must read and understand
the basic coverages your policy offers. Know the pilot require-
“If you operate your aircraft only within
the 48 contiguous states, you are
covered by every basic policy issued
by domestic aviation insurance underwriters.
This is where the universal
similarities end.”
AIRCRAFT OWNERS
ments, confi rm the hull value, and defi ne the purpose of use,
to name just a few. It is important that all policy variables must
be clearly defi ned and understood by you, the aircraft owner
and operator. Ignoring such details can lead to disappointing
and expensive lessons after a loss has occurred.
What about policy territorial limitations?
I thought we were covered everywhere.
There is no policy detail more important and more confusing
than the territory of operation. I might also say, there is no
policy detail more poorly defi ned by the industry than the territory
of operation.
In an effort to simplify the questions surrounding territory
defi nition, the Aviation Division at CS&A Insurance has compiled
the following information. We compared actual copies
of each insurance underwriting company’s basic policy forms,
reviewed standard policy expansion endorsements and, in
most cases, interviewed the respective underwriters seeking
explanations of those areas we felt were ambiguous or poorly
defi ned. Through all this effort, the topic remains very confusing.
As a result, we are offering the following information only
as a guide and would recommend that you review your own
policy. If you fi nd it confusing, call your agent for a specifi c
explanation or defi nition.
So, where am I covered?
(Or, do I need a geography lesson?)
If you operate your aircraft only within the 48 contiguous
states, you are covered by every basic policy issued by domestic
aviation insurance underwriters. This is where the
universal similarities end. If, however, you are getting ready
to hop into your aircraft and pilot yourself and your family on
that long anticipated winter Caribbean trip, you should stop
and read your aviation insurance policy carefully. If you have
changed underwriters recently, or have never paid attention
to where you are covered, you may be surprised to discover
that the territory your policy covers has changed, or it differs
from what you expected. Different underwriters provide different
territorial coverages, and the designations they use for
the same geographical location may vary between them. By
examining each individual policy and the actual territories covered,
you can obtain a better understanding of the geographical
scope of your coverage.
The 48 continental United States and Mexico
The normal aviation insurance policy applies within the 48 contiguous
states and Mexico. We know of no exceptions to this
statement. There is one word of caution, however. When traveling
to Mexico, the Mexican government does not recognize
your policy issued by a U.S. aviation insurance underwriter.
As a result, you must have in your possession proof of Mexican
Liability insurance issued through a Mexican insurance
company. Some U.S. underwriters purchase these certifi cates
from a Mexican insurance company and include them with your
U.S. issued policy at no additional cost to you. Some under-
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