Aviation Insurance Cost Guide

Understanding aviation and aircraft insurance costs is essential for making informed decisions—get in touch with our experts today for personalised guidance and quotes.

Navigating Aviation Insurance Costs

For aircraft owners, operators and businesses involved in aviation, obtaining insurance is highly advisable due to the significant risks associated with aircraft ownership and operation.

In fact, aviation insurance is a non-negotiable requirement for commercial airlines, including companies applying for international air licences.

Aviation and aircraft insurance works to manage the unique risks of flying. This includes coverage for potential accidents, damage to the aircraft, and liability for injuries or damages caused to third parties.

Knowing the cost of insurance upfront can make all the difference when budgeting for your aviation activities, whether you’re flying for pleasure or managing an entire fleet for a commercial enterprise.

For private aircraft owners, airlines, flying schools, and charter companies alike, understanding insurance costs helps in making informed decisions about obtaining the right level of coverage. This guide breaks down the key elements that affect the price of aviation insurance in Australia, so you get a clear view of what to expect.

Aviation and Aircraft Insurance – Are They One and the Same?

Aviation insurance and aircraft insurance are terms often used interchangeably, but they can refer to different aspects of coverage related to the operation and ownership of aircraft.

  • Aviation Insurance: This refers to a broad category of insurance encompassing various types of coverage related to the operation of aircraft. It includes liability coverage for accidents, personal injury, property damage, and other risks associated with aviation operations. Aviation insurance can be tailored to meet the specific needs of aircraft owners, operators, and service providers.
  • Aircraft Insurance: This term typically involves insurance policies that cover the aircraft itself. It includes hull insurance (covering physical damage to the aircraft) and liability insurance (covering legal liabilities arising from accidents involving the aircraft). Aircraft insurance can be part of a broader aviation insurance policy or standalone policies designed for individual aircraft.
Aviation Insurance Cost Explained

How Much Does Aviation Insurance Cost on Average?

In general, aviation insurance in Australia can range from around AUD 1,500 to AUD 10,000 annually per aircraft, depending on various factors.

Small private planes or light aircraft might see premiums on the lower end of this spectrum, while larger commercial planes or jets can push the cost higher. Insurers will consider the value of the aircraft, its intended use, the pilot’s experience, and the coverage level required.

To get a more accurate or tailored quote, it’s best to discuss your specific needs with a trusted insurer like AGL Aviation.

Interested in Aviation Insurance?

Whether you’re seeking a quote, have questions, or want to explore the best options for your needs, contact AGL Aviation today.

Why Do You Need Aircraft Insurance?

As mentioned earlier, aviation comes with very specific risks, both in the air and on the ground. That’s where aircraft insurance steps in; it protects you from the financial fallout of accidents, damage, or injury.

Aviation liability insurance is a critical component of any aircraft owner’s insurance package. It covers damages caused to third parties, including property damage and personal injuries, in the event of an accident. This coverage is crucial not only for aircraft owners but also for businesses operating within the aviation industry, as legal liabilities in aviation can quickly escalate into millions of dollars.

Aviation liability insurance typically includes two main types of coverage:

  • Third-Party Legal Liability: This covers damages caused to people or property on the ground due to an aircraft accident. For example, if an aircraft were to damage a building or injure someone during a crash, third-party liability would cover those costs.
  • Passenger Legal Liability: Even with strict safety standards, accidents can happen, and this coverage ensures that legal and compensation claims are managed without devastating your finances. It covers your legal responsibility for injuries or deaths of passengers onboard the aircraft, whether you’re flying privately or commercially.

 

Premiums for aviation liability depend on factors such as the type of aircraft, its use, the amount of liability coverage, and the risk profile of the pilot or operator. Liability limits typically range from AUD 10 million to AUD 20 million in Australia, but figures vary depending on one’s operations. Some businesses may even opt for higher coverage.

Factors Impacting Aviation Insurance Premiums

Factors to Consider When Purchasing Aviation Insurance

When purchasing aviation insurance, it’s crucial to understand the various factors that can impact your premiums. Insurers will assess several aspects of your aircraft and its operation to determine the risk/s and price.

Aircraft Type

The size, make, and model of your aircraft play a significant role in determining insurance costs.

For instance, a small single-engine propeller plane used for recreational flying will typically have lower premiums than a commercial jet used for passenger transport. Aircraft with higher performance specs or older models may also attract higher rates because of the increased risk of accidents or the cost of repairs.

Aircraft Value

The market value of your aircraft directly affects your insurance premium. Simply put, the more your aircraft is worth, the higher the coverage amount needed, and the more you can expect to pay. Aircraft insurers consider the cost of replacement or repair in case of damage, whether from an accident or weather-related incidents.

Pilot Experience

A pilot’s experience and training can significantly influence the cost of insurance. Insurers will look at the number of flight hours logged, the type of aircraft a pilot is certified to fly, and any relevant safety records.

More experienced pilots with proven safety records are often rewarded with lower premiums, while inexperienced or infrequent flyers may see higher costs due to perceived risks associated with their lack of or inadequate experience.

Aircraft Use

How you use your aircraft is another key consideration. Is it intended or being used for personal, commercial, or agricultural purposes?

For example, aircraft used for crop-dusting or aerial photography may face higher premiums because of the unique operational risks. On the other hand, a privately owned aircraft used occasionally for leisure flights may result in a lower insurance cost.

Claims History

As with any form of insurance, your past claims can impact your premiums. If you’ve previously made claims for accidents, damage, or liability issues, insurers might view you as a higher risk, which could lead to increased premiums. However, a clean claims history may work in your favour, potentially lowering your rates.

Aircraft Insurance Cost by Type and Sub-Types

The complexity of aviation operations often necessitates specialised insurance products tailored to individual needs. The table below provides an overview of how the type of aircraft and its uses can affect the cost of insurance premiums or aircraft insurance rates.

Aircraft Make & Model Uses Hull Value Liability Limit(Combined Single Limit) Price Range*
Cessna 210 Private, Pleasure and Business AUD 300,000 AUD 10,000,000 AUD 6,200 – AUD 6900
Cessna 182 Private, Pleasure and Business AUD 1,000,000 AUD 10,000,000 AUD 11,500 – AUD 13,000
Robinson R22 Helicopter Aerial Work Including Mustering AUD 500,000 AUD 10,000,000 AUD 32,000 – AUD 36,000
Piper M350 Private, Pleasure and Business AUD 2,000,000 AUD 20,000,000 AUD 31,000 – AUD 35,000
Cirrus SR20 Private, Pleasure and Business AUD 300,000 AUD 10,000,000 AUD 5,500 – AUD 6,500
Robinson R44 Helicopter Commercial (Charter) AUD 600,000 AUD 10,000,000 AUD 21,000 – AUD 23,000
Cirrus SR22 Private, Pleasure and Business AUD 1,500,000 AUD 20,000,000 AUD 12,500 – AUD 14,000
Cessna 172 Private, Pleasure and Business AUD 200,000 AUD 10,000,000 AUD 4,200 – AUD 5,500
Air Tractor 502 Aerial Agriculture AUD 600,000 AUD 10,000,000 AUD 32,000 – AUD 38,000
Beechcraft Baron Commercial (Charter) AUD 300,000 AUD 10,000,000 AUD 6,000 – AUD 7,500
Robinson R66 Private, Pleasure and Business AUD 1,200,000 AUD 10,000,000 AUD 14,000 – AUD 20,000
*NOTE: Pilot experience is a significant factor in the above costs.

Based on the above table, here are a few examples that highlight the range of costs based on the aircraft make, model, and usage:

  • Cessna 210: Used for commercial or for private, pleasure, and business purposes, this aircraft has a hull value of AUD 300,000 and a liability limit of AUD 10,000,000. Cessna 210 insurance costs generally fall between AUD 6,200 and AUD 6,900. This is a relatively affordable range for light aircraft, making it ideal for private owners or small businesses.
  • Piper M350: With a higher hull value of AUD 2,000,000 and a liability limit of AUD 20,000,000, the Piper M350 used for private and business purposes sees insurance premiums between AUD 31,000 and AUD 35,000. The combination of its value and enhanced liability coverage pushes its premium into the higher range for a speed pressurised cabin aircraft.
  • Cirrus SR22: Known for its advanced safety features (including a ballistic parachute that can be deployed during emergencies), the Cirrus SR22 is popular among private owners. Its hull value of AUD 1,500,000 and liability limit of AUD 20,000,000 places the Cirrus SR22 insurance cost between AUD 12,500 and AUD 14,000. This model highlights how both aircraft value and safety features can influence premiums however pilot training and currency are paramount with this aircraft type.

 

For businesses managing a fleet, such as those using helicopters for commercial charters or farm work, aircraft insurance costs can climb, especially for specialised uses like aerial agriculture.

For instance, the Air Tractor 502, used in aerial agriculture, can see premiums as high as AUD 38,000 due to its high hull value plus the specific risks associated with this type of operation. These risks include chemical drift (when pesticides affect non-target areas or neighbouring properties) and geographical or weather conditions that can affect low-altitude flights typical of aerial agricultural operations including avoidance of power lines.

Key Insights for Prospective Clients

  • Pilot Experience Matters: One of the most critical factors that can impact aircraft insurance rates is pilot experience. Highly experienced pilots, particularly those with thousands of hours logged and clean safety records, often qualify for lower premiums. Conversely, newer pilots or those without specific aircraft experience can expect higher costs due to the perceived elevated risk and tail-wheel aircraft also require some experience to reduce premiums.
  • No Claims Bonus: In Australia, many insurers offer a no claims bonus, typically ranging between 10% and 20%. This discount rewards aircraft owners for maintaining a claim-free record over a given policy period. This can make a noticeable difference, especially for owners of high-value aircraft like the Piper M350 or Cirrus SR22.
  • Profits Commission on Renewal: If you operate a fleet, you have the potential savings from a profits commission. This feature rewards owners of multiple aircraft by returning a percentage of the hull premium paid during the previous policy period, depending on their claim history. This benefit provides additional savings for businesses as it makes the renewal process more cost-effective.
  • Competitive Offers on Renewal: To retain or win new clients, some insurers may offer to match the renewal premium of a competitor. This is where a specialised aviation insurance broker, like AGL Aviation, steps in. We can help you navigate these offers, so you get the most competitive premium without sacrificing coverage. By leveraging our status as a specialised aviation insurance broker, we can help you understand the terms, conditions and different premiums and provide a comparison. We’re here to make sure you’re not overpaying for your insurance.

 

So, even when aeroplane and helicopter insurance costs may seem prohibitive, with the help of a knowledgeable aviation insurance broker, you can manage and even potentially reduce your premiums while ensuring comprehensive coverage for your aircraft or fleet.

Helicopter Insurance Cost-min

What You Need to Know About Helicopter Insurance Costs

Helicopter insurance differs from traditional aircraft insurance because of the unique nature of rotary-wing aircraft. Helicopters tend to be more complex to operate, more expensive to maintain, and often used in riskier environments, which drives up insurance costs.

For example, helicopters like the Robinson R22 used for aerial work, including mustering, tend to have higher premiums due to their operational risks. Considering the aircraft’s hull value of AUD 500,000, Robinson R22 insurance costs typically range from AUD 32,000 to AUD 36,000.

Helicopter insurance policies generally include hull insurance (covering physical damage to the helicopter) and liability insurance, similar to fixed-wing aircraft. However, the potential for claims is often higher with helicopters because of their ability to land and take off in various environments, where accidents are also more likely.

Pitfalls to Avoid and Tips to Minimise Aircraft Insurance

Purchasing aircraft insurance is a significant investment, but there are ways to avoid common pitfalls and keep costs manageable:

  • Over-Insuring or Under-Insuring: Ensure you are insuring your aircraft for its current market value. Over-insuring will lead to unnecessarily high premiums, while under-insuring can leave you vulnerable to out-of-pocket costs in case of a claim and may end up having your aircraft written off rather than being repaired.
  • Neglecting Pilot Experience: Pilot experience and training are key factors in determining insurance costs. Ensuring that your pilots have sufficient training and certification for the aircraft they’re operating can lower premiums.
  • Ignoring Claims History: A poor claims history can significantly increase your premiums. Implementing safety protocols and regular maintenance to avoid claims can help keep your premiums in check.
  • Skipping the No Claims Bonus: Many insurers offer a no claims bonus if you have a clean claims record. Take advantage of this option if it applies to your situation and can reduce your premium.

 

To minimise costs:

  • Bundle Policies: If you operate multiple aircraft, bundling policies with one insurer can lead to a profits commission, lowering overall costs.
  • Maintain a Clean Safety Record: A history of safe operations without claims is your best leverage for lowering premiums over time.
Reducing Your Aviation Insurance Costs with AGL Aviation Insurance Brokers

How to Get the Best Aviation Insurance Deal

Finding the best aviation insurance deal isn’t only about getting the lowest premium. What’s more important is that you get comprehensive coverage tailored to your needs at a fair price.

Here’s how you can secure cost-effective aviation insurance costs:

  • Work With a Specialised Broker: Aviation insurance is a niche market, and working with a broker that specialises in this field can help you navigate complexities or any grey areas. AGL Aviation, for instance, has years of experience and can help you compare different insurers, so you get the most competitive rates.
  • Review Your Coverage Needs Regularly: As the market value of your aircraft changes, so should your insurance coverage. Regularly reviewing your insurance policy ensures you’re not paying for coverage you no longer need, or worse, under-insuring your assets. Discuss this with your specialise Aviation Insurance Broker. AGL Aviation can regularly review your cover and requirements.
  • Shop Around for Renewal: Insurers often offer to match competitors’ premiums to retain business. When it’s time to renew, ask your broker to help you compare offers to make sure you’re getting the best deal. Some aviation insurers work direct which could mean you’re paying too much, whereas a specialist aviation broker can get you the best deal.
  • Leverage Discounts: Always check for available discounts, such as no claims bonuses or profits commissions, as these can reduce your renewal premiums significantly.

Need aircraft insurance advice?

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Ready to take the next step in protecting your aircraft?

At AGL, we specialise in aviation and aircraft insurance (including glider and drone insurance) that’s tailored to your specific circumstances and requirements. Whether you are flying for pleasure, business, or are into full-fledged commercial operations, our experienced team is here to help you find the best coverage at the most competitive rates.

Don’t leave your investment unprotected—contact us today for a personalised quote.

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Frequently asked questions

Aircraft Insurance Questions

Understanding aircraft insurance can come with its own set of queries and uncertainties. Our FAQ section is tailored to address your most pressing questions, guiding you smoothly through the complexities. Delve in and discover the clarity you need.
What information would I need to get a quote on aircraft insurance?
  • Aircraft make and model
  • Uses of the Aircraft (hazardous uses will require detailed pilots experience)
  • Pilot history, age, and experience of pilots
  • Cover required – Full Flight Risks and/or Ground Taxiing Risks
  • Depending on aircraft type/uses – details of pilot training
  • Claims history (Incidents/Accidents)

 

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What factors do insurance companies use to determine my premium?

All aviation insurance companies are different. Factors can include the age of the aircraft, use of the aircraft, experience of the pilot, loss history of the make and model, state/territory in which the aircraft is used, pilot training, value of the aircraft, and limits of liability. It’s important to work with an aviation insurance specialist such as AGL Aviation who knows the market and understands how to place your insurance whilst getting the best rates and coverage.

How long would it take to start an aircraft hull and liability insurance?

As a specialist we can provide a quick turnaround and depending on the complexity of the risk we can place cover on the same day you call us.

Does an aircraft with a good safety record mean lower rates for aircraft insurance?

Each insurance provider will have their own rating structure based on the safety record of different aircraft, and costs to repair (including the availability of parts) associated with each aircraft make and model.

Aircraft with a good safety record combined with low repair costs can have a favourable influence on insurance costs. If you are considering the purchase of an aircraft, it’s a good idea to discuss it with an aviation insurance specialist such as AGL Aviation before you buy.

How much should I insure my aircraft for?

We would recommend insuring your aircraft for what it would cost if you had to replace it with an identical aircraft (Year/Make/Model and condition). It would be advisable to do some research on similar aircraft available. You should also factor in USD/AUD exchange rates and the supply and demand of aircraft types and spare parts.

Insuring an aircraft Hull for more than its current market value may adversely impact the insurance company’s decision following an accident as to whether or not to write off or repair the machine. The insurer of an “over-insured” aircraft will be more likely to elect to repair a severely damaged aircraft. Conversely, “under-insuring”, that is insuring the aircraft Hull for less than the fair current market value, could result in the insurer electing to make the damaged aircraft a “total loss” when the aircraft would have otherwise been repaired.

What liability limit do I require?

There is no simple way to determine this. It is generally best to buy the highest liability limit you can reasonably afford. However, there are various factors to be considered when purchasing liability insurance including any contractual requirements, number of passenger seats, bank/finance requirements and aircraft uses.

If the aircraft is used for Charter (i.e. fare-paying passenger carriage), then you would need to consider the minimum limit of liability per seat as per the Civil Aviation (Carriers’ Liability) Act (1959).

I have just made some major upgrades to my aircraft and I want to increase my hull value - what do I need to do?

It’s important to consider your current hull value after major upgrades, modifications, new engines etc as the upgrades could increase the life of the aircraft and the value of the aircraft.

Changing your hull value can be easy. In some cases, we can increase the value over the phone. In other cases, your insurance company will require a list of the work undertaken and the associated costs.

What is an open pilot warranty?

An Open Pilot Warranty is a condition stated in the insurance policy which allows pilots that meet certain minimum qualifications to fly the aircraft without being specifically endorsed on the policy as a Named Pilot.

Some policies don’t contain Open Pilot Warranties. In many cases, we can request to specifically approve and name a pilot that does not meet the specific Open Pilot Warranty on your policy.

What is the difference between an insurance broker and an insurance company?

An insurance broker represents you and has the responsibility to negotiate the best terms and conditions of the insurance coverage on your behalf with the insurance company. Most insurance companies work only through insurance brokers so it is crucial that you choose a professional insurance broker such as AGL Aviation as your representative.

The insurance company creates the policy and pays the claims. Insurance companies can differ in their business focus, policy language, pricing, and claims support capability.

It is a broker’s job to place the business with the insurance company that best fits the needs of the client at the best available terms and conditions.

What is breach of warranty in aircraft insurance?

Breach of Warranty provisions are often required by a financial institution that holds a financial interest in an aircraft. They are often added by endorsement that revises the basic policy and provides cover for the financier to be compensated in the event of an aircraft being subject to a claim which the insurer may decline to pay due to a breach of policy conditions by you or an approved pilot. The Breach of Warranty cover may enable the entity that holds the financial interest to still be paid by the insurer up to the amount of their financial interest in the aircraft.

My aircraft is currently with my maintenance organisation undergoing an overhaul. Do I need to have my own insurance policy or will the maintenance organisations policy cover my aircraft?

It’s strongly recommended that you cover your aircraft with your own policy. Some Maintenance facility’s may carry hangar keeper’s liability (which is designed to protect the maintenance organisation in the event of damage to an aircraft whilst under the care, custody or control of the maintenance facility due to their negligence).

In some circumstances, the maintenance organisation may have purchased insufficient or deficient coverage and this may impact the protection of your asset.

Additionally, even if the maintenance organisation enjoys adequate cover its hangar keeper insurance policy may not pay out for certain types of losses, for example, those resulting from storm, vandalism, or mechanical failure. If the maintenance organisation is not legally liable for the loss, it’s unlikely the insurance company will be required to compensate you or the maintenance organisation.

Does an aircraft with a good safety record mean lower rates for aircraft insurance?

Each insurance provider has their own ratings and guideline to work from but an aircraft with a good safety record combined with low repair costs can have a favourable influence on insurance costs. If you are considering the purchase of an aircraft, it’s important to discuss your choice with an aviation insurance specialist before you buy to avoid any surprises after the fact. You don’t want to complete a purchase and subsequently learn that the cost to insure your new aircraft is higher than you expected.

Can I find reasonably priced aircraft insurance after an accident?

Accidents happen. In most cases, the future insurability of the pilot who had the accident is based on the circumstances of the claim itself. A costly insurance claim may have a greater impact on your future insurability. If the claim was caused by a mechanical malfunction and had nothing to do with the pilot, the insurer may be more understanding. In cases of pilot neglect or error, a new insurance policy can be more challenging to obtain, but this is where an aviation insurance specialist such as AGL Aviation is needed to assist in these situations.

Didn’t find the answers to your questions? Don’t hesitate to contact us.