Aviation Insurance 101: How to save on helicopter policies

For 36 years, aviation insurance broker Sandy Odebunmi has helped air operators manage risk.  

As vice president of aviation at Toronto-based Sound Insurance Services, Odebunmi specializes in general aviation insurance, from hot air balloons to corporate jets. 

After nearly four decades in the business, she shared some important advice for small commercial helicopter operators and individual owners looking for coverage. 

“My best tip to everyone in aviation, particularly helicopter operators, is to get yourself an aviation broker,” she told Vertical. “It’s not the person who does your home, auto or building insurance. It’s the person who only deals with aviation. An aviation brokerage will understand coverages and pricing, and will have access to compare applicable insurance companies.” 

Odebunmi and her team do just that, shopping around for coverage options that are customized to their aviation clients. In the Canadian helicopter insurance market, there are not a lot of choices to begin with — so she said it’s important to bring your best application to each insurer. 

“There are only about 10 aviation insurance companies here in Canada at any one time. Right now, for commercial rotary-wing, there is one main insurer and one or two alternates,” she explained. “For individual owners, there is an insurer who recently added private helicopter coverage to their offerings, and prices are quite reasonable — so this is a good option if you are just using your helicopter for your own business and family.” 

When applying for aviation insurance, it’s best to remember two key points: start early and provide as much information as possible.  

“Respond as soon as you get your renewal notice,” advised Odebunmi.  

Aviation insurance brokers will only issue quotes within 30 days of renewal, but a broker typically starts 60 days ahead of renewal to gather a company’s pilot and helicopter information, hull values, mission profiles, and any operational changes. Then, they negotiate with insurers early in the hopes of getting quotes sooner rather than later. For new policies, it’s best to begin looking many months before you need insurance. 

“Starting early allows time to consider your options,” she continued. “A broker can go to several companies and give them time to quote you properly.” 

Odebunmi also said helicopter operators benefit from considering the application carefully, particularly through the lens of what sets them apart from other operations.  

“Tell them about what makes you safer than someone else,” she explained. “Send in pilot resumes, safety management systems, anything that makes you safer. Present yourself in the best light possible.” 

Speaking of pilots, Odebunmi advised operators to check with their insurer prior to hiring any lower-time applicants. Sometimes that pilot may be refused, although she said most insurers will work with operators to enable coverage. In any case, more information is always better. 

“In the past, I’ve gotten a letter from an instructor praising the capability of a low-time pilot — you have to take the time to provide that information,” she said. “A little bit of work gets the best result.” 

Managing premium costs 

Odebunmi explained that typically, aviation insurance must be paid in full up front. Or, a finance company pays the insurer and then the operator makes payments to the finance company.  

Liability coverage is mandated by Transport Canada and the Canadian Transportation Agency, with rates calculated based on aircraft takeoff weight and passenger capacity.  

Premiums can be high, so she offered some tips that could help to keep costs down. 

“In aviation insurance, if you increase your  deductible by a lot, you can look at how it affects your policy,” she said. “It’s something to consider. Think about what you might be willing to self-insure. Some people do operate with liability only and no hull insurance, and that will save money — but that’s up to the owner.” 

She also advised operators to look back at their claim history. What has been paid out and what claims have been made over the years? 

“You can get that information from your broker,” she said. “Be aware that you can pick and choose your coverage per machine. Maybe you want to drop the hull coverage on an older helicopter with an engine that is timing out.” 

While insurers generally provide annual quotes, helicopters often fly less in the winter months. This could represent an opportunity for structured payments.  

“If your payments are made to a finance company, you may be able to pay them more in the summer and less in the winter,” offered Odebunmi. “If you have a busy summer, you may be able to pay off the entire policy with no penalty. There is one insurer who adjusts for days on the ground up front; that can be tweaked. I also have a couple of insurers who offer free quarterly installments, versus paying a six percent premium for the privilege of monthly payments. 

“The important thing is, be creative and ask.” 

It’s also crucial to keep insurance companies informed of any operational changes that could affect your policy — if your company stops slinging external loads, for instance. 

“Always ask for a credit in a situation like that,” advised Odebunmi. “It’s unusual to get a mid-term credit, but always ask.” 

Other factors influencing policy terms include whether an operator needs additional coverages on spare parts, fueling, aircraft maintenance operations, or instructing on a student’s helicopter. 

Once those policy quotes arrive, it’s time to sit down and read them carefully. 

“It’s true that people don’t always read their entire policy, but I want people to read everything and ask questions up front,” said Odebunmi. “When you’re operating a fleet of helicopters, it’s too important. You have to sit there with a strong cup of coffee and get through it.” 

Private individuals who fly their own helicopter for business and pleasure have additional considerations, she pointed out.  

“If you’re taking high income earner passengers up with you, you might want a higher limit. If it’s just going to be you, get the lowest limit possible.” 

To conclude, Odebunmi said aviation insurance is not like getting a quote to renovate your basement.  

“You really have to pick your broker and work with that broker,” she said. “Coverage and price will come from any insurer. What’s left? Service. If that broker doesn’t answer your calls, look elsewhere.” 

She offered one piece of final advice to small operators and individual helicopter owners who are shopping for insurance: “If it was me, I wouldn’t take the first quote. Ask questions, ask for options, ask for alternate terms.”