The Aviation Insurance Market Has Been Undergoing Big Changes And A New Report Shows These Changes Are Accelerating
The Aviation Insurance market has undergone major changes in the past several years with fast rising rates and a major reduction in capacity. An updated report from one of the nations top aviation insurance brokers shows that even in just the past 6 months, big changes are still occurring with many of the best aviation insurance companies.
Aviation Insurance is a specialized industry with less than 20 insurance carriers as opposed to over 500 auto insurance carriers. An updated report on the 10 best aviation insurance companies shows that even in just the past 6 months, major changes are still occurring for some of the largest carriers.
Near the end of the 3rd quarter in 2018, everything began to change in the aviation insurance marketplace. After a decade of new insurance companies entering the market and record low rates due high competition, the market finally began to correct itself. Record low premiums for many years didn't change the number of claims and aircraft accidents reported and the insurance companies paid a huge cost. Since 2018 multiple large aviation insurance companies have exited the market, insurance premiums have begun to rise 25-100% and the implications are still being felt today.
According to an aviation insurance market update report, written in June of 2020, rates had begun to rise due to many factors including the increasing cost of aircraft repairs, higher level of claims and a higher level of liability awards. These factors, along with reduced capacity are continuing to push big changes for the top aviation insurance companies.
Some of these changes in just the past 6 months include 2 aviation insurance companies exiting the light-aviation insurance market and another global insurance company finally taking place in the 10 best list, for aviation insurance. With many airline fleets still grounded due to COVID-19, increased claims and reduced capacity, aircraft owners are in for a wild ride over the next few years.
