07 Jul Insurance Policy Analysis
Review the and at the cover page, assume that you purchased the following limits:
- Coverage A: $1 million per occurrence, $100,000 per passenger
- Coverage B: $200,000
And:
The pilot endorsement includes:
- You, by name, and any other pilot holding a currently valid FAA Commercial Pilot Certificate with
Second Class Medical Certificate and have logged at least 500 hours as pilot in command in
the same category and class as the non-owned aircraft.
You are operating a rented aircraft with one passenger on board, attempting to land in a strong and gusty
crosswind, when you lose control. The aircraft departs the runway, the nose wheel strikes a runway light,
and the aircraft flips over.
Answer
Based on the Sample Non-Owned Aircraft policy, will the insurance company pay, (and if so, how
much) for each of the following losses? Cite the policy paragraph(s) relied on for each answer.
(Treat each numbered question as a separate question, rather than a continuation of or follow-on to the
previous question(s).)
Note: You must read the entire policy if you want to have any chance of getting all of these questions correct. Several can only be solved by a careful reading of multiple sections of the policy. If you find a section that seems to apply, ask yourself “what next” and keep reading.
- Your passenger, a friend who was along for this recreational flight, is injured, and incurs
$20,000 in medical expenses as a result. - You are injured, and incur $18,000 in medical expenses as a result.
- You and your passenger each had an $1,800 laptop computer in the baggage compartment, and each was destroyed in the crash.
- Your intended destination was the border town of Douglas, Arizona, but the wind had kicked
up a lot of blowing dust, causing you to mistake the close-by airport in Agua Prieta, Mexico
for the Douglas Airport. You landed there, where the accident occurred. How will this affect
the insurance company’s liability for:
a. damage to the aircraft?
b. passenger injuries?
