Pilots Life Insurance

Life insurance is the only insurance coverage everyone is certain to use and it’s critical for your family’s security. So you don’t want to apply for life insurance only to find out your favorite hobby or professional pursuit will complicate matters.

Piloting an airplane may seem risky and historically insurance carriers tended to agree with that theory. However, over the years, the insurance industry has come to realize that pilots tend to be less of a risk than previously assumed.

This means pilots are now able to secure life insurance coverage without much hassle. So, if you are a pilot without coverage, the good news is, you can get affordable life insurance coverage even though your job is risky compared to others.

Life Insurance for Pilots – Applying

affordable life insurance for pilots

Twenty years ago life insurers would either flatly deny a pilot’s application for life insurance or include a policy exclusion denying benefits when the insured’s death resulted from flying. Also, life insurers would typically lump all pilots into the same high-risk category regardless of their aviation experience or the type of plane. Nowadays life insurance companies recognize the odds of being in a fatal plane crash are 11 million to 1.

There is a greater chance of being killed while driving a Camry rather than a Cessna. Plus, pilots statistically are proven to be better educated, earn higher incomes, maintain insurance policies for a longer time, and are in better health than most Americans. This means pilots are a great risk for a life insurer and, in some cases, may even be able to secure a preferred life insurance rate.

Life insurance companies recognize that pilots must remain healthy and fit to maintain their pilot’s license. This is viewed as a plus by life insurance companies. Depending on the pilot’s age and class, the Federal Aviation Administration (FAA) requires regular medical exams. The general rule for aviation medical certificates is as follows:

1st Class (ATP):

Every 12 months if younger than age 40, Every 6 months if older than 40

2nd Class (Commercial Pilots):

Every 12 Months

3rd Class (Private / Student / Recreational Pilots):

Every 2 Yrs if Over 40 Old, or every 5 Yrs if Under 40 Old

The type of medical examination performed is similar for all airman classes, including a review of vision, hearing, medications, and illness/surgeries. First class medical exams must be done more frequently and require the applicant to have an electrocardiogram (ECG) done annually if over age forty. Life insurance companies recognize pilots are expected to maintain good health and, because of this, often reward pilots with preferred rates.

Life Insurance for Pilots – the Underwriting Process

Pilots need to be prepared for the types of questions an insurance agent or Underwriter will ask when applying for life insurance. Some life insurers will rate the below factors more favorable than others so it’s important to discuss this with your insurance agent. If you work with an experienced aviation insurance agent then you can be sure he/she will understand the nuances of these answers and be able to help your Underwriter better understand as well.

It’s standard practice for life insurers to require all pilots complete an aviation supplement to the standard life application. The questions on that supplement will include the following:

  • What type of aircraft do you typically fly?
  • Are you a private pilot, commercial pilot, or a student pilot?
  • Are you instrument rated? What kind of certifications or licenses do you have?
  • When did you become certified? How many years have you been flying?
  • How many hours do you fly per month/year?
  • Have you encountered any accidents or incidents while flying?

 
In addition to the above questions, you should expect the insurance agent and underwriter will look to see if you have any FAA violations or in-flight incidents. Obviously, if you do have anything on your FAA record, your policy premiums may be impacted.

Life Insurance for Pilots – Commercial vs. Private Pilots

cheap life insurance for pilots

Whether you enjoy flying a small plane for pleasure or a large commercial jet for employment, you should not be concerned about securing life insurance. If your health and flying record are good then the process of applying and securing life insurance will be so much easier. However, we do advise that you should be prepared for the fact that life insurers view private pilots a bit differently than commercial pilots.

Life insurance companies prefer to issue life insurance for private pilots who fly between 30 – 150 hours per year. This is because private pilots that fly less than 30 hours per year are relatively inexperienced and could have a grave accident as a result. On the other hand, private pilots that fly more than 150 hours per year are at an increased risk of a fatal accident simply because of higher exposure.

 
An increased number of flying hours means more opportunities each year for the pilot to be involved in a terrible accident. If a private pilot has additional adverse risk factors, such as FAA violations or a history of seizures, life insurance carriers may require an aviation exclusion rider.

This type of rider states no death benefits will be paid under the life insurance policy if the insured’s death occurs as a result of travel or flight in an aircraft as a pilot or student pilot. If you are a pilot with this type of rider on your life insurance policy and your death is caused by something other than aviation then your loved ones will receive the death benefit.

In some cases, the underwriter will assign a “flat extra” to a private pilot’s life insurance policy. A flat extra is an additional payment the insurer builds into the premium to cover the extra risk. Sometimes the flat extra is permanent on the policy and sometimes it is only a temporary addition.

The cost for a flat extra on average is anywhere from $1.25 per thousand to $15 per thousand dollars in coverage. The practice of adding a flat extra to a private pilot’s policy varies among insurance companies. So please don’t let the flat extra fee discourage you from securing life insurance altogether.

Private pilots that are Instrument Flight Rules (IFR) certified are also considered a preferred rate class for many life insurers. So if you are not yet IFR certified and will be shopping for life insurance, it may be a good idea to secure that additional certification. If you are a private pilot with the IFR certification then please be sure your insurance agent is aware of this information.

 

You want to be sure you’re providing the Underwriter with as many details as possible to secure a favorable life insurance rate.

Commercial pilots still maintain a slight advantage over private pilots in the eyes of life insurance companies. This is because professional pilots work for airline companies governed by strict FAA rules and regulations. Pilots of passenger jets have a fatal accident rate that is 35 times more favorable than all types of pleasure flying. It is not unheard of for commercial pilots in good health to qualify for preferred life insurance rates.

Life Insurance for Pilots – Student Pilots

Student pilots are able to obtain a life insurance policy same as their more experienced peers. However, a student pilot will almost never qualify for a preferred rate. The risk to the insurance company is so much higher for a beginning pilot with little experience.

The majority of student pilots will be approved for a standard rate with a flat extra. As we explained before, the flat extra is an additional fee that is added to the life insurance premium to cover “high risk” insureds.

The fee for most student pilots is $2.50 per $1,000 of coverage. For example, if you were to apply for a $100,000 policy, you would need to pay an additional $250 per year for your policy.

 

Remember a flat extra fee can be permanent or temporary depending on the insured’s situation. In the case of a student pilot, once you become certified and gain additional flying hours (usually 600+), your life insurance agent will encourage you to re-apply for better life insurance rates with no fees or rate-ups.

Life Insurance for Pilots – Saving Money on Premiums

save money on life insurance for pilots

All pilots pay slightly more for life insurance than their non-flying peers. To help you save as much in premium as possible, there are other factors you can control which will keep the life insurance premium low:

Stop Smoking 

Tobacco smokers automatically pay double the life insurance rates that non-smokers pay. That is a big markup in cost you want to avoid. If you are looking to reduce premiums, you need to kick the habit and be smoke-free for a minimum of one year.

Take Care of Your Overall Health

Pilots dealing with health issues such as high blood pressure, high cholesterol, or obesity will pay significantly more than their peers. This is because you partake in a risky activity like flying while also dealing with chronic illness. All of this adds up to a great concern for the life insurance company and a higher premium for you.

Shop Multiple Life Insurance Companies

Each life insurer has different underwriting guidelines and premium tables. So you always want to work with your life insurance agent to find the insurer that fits your situation best. There are dozens of insurance companies that will be pleased to insure a pilot. Shop multiple life insurance companies to compare the best rates.

 

Life Insurance for Pilots – Alternative Coverage Options

Over time it’s become much easier for pilots to secure individual life insurance policies at a reasonable price. However, if you find yourself in a complicated circumstance that is preventing you from obtaining life insurance, you may want to look for alternative life insurance coverage. There are a few avenues we recommend you explore.

First, pilot associations are a great option in obtaining group life insurance for member pilots. Aircraft Owners & Pilots Association (AOPA) or Air Line Pilots Association (ALPA) are two examples of pilots organizations that provide group life insurance for pilots. Signing up for a group life insurance policy allows you to get group rates which are usually lower than individual life insurance plans.

 
The pilot organizations are able to secure those lower rates by partnering with a life insurer that is comfortable with underwriting in the aviation field. Also, being part of a group life insurance policy spreads out the overall premium costs among the other participants.

Finally, if you still can’t find a group or individual life insurance plan for pilots that meets your needs, the best option is to purchase a guaranteed issue life insurance policy for high-risk individuals. A guaranteed issue life insurance plan ensures you will not be declined because of your occupation or activities.

 
Being a pilot will not exclude you from securing guaranteed life insurance coverage. In fact, a guaranteed issue plan means there is no medical exam and no traditional underwriting required to issue coverage. Even though you will pay more, since the insurance company is accepting you without knowing the risk, you will have life insurance in place.

The bottom line is you are buying life insurance as your last act of love for your family. Isn’t a little extra premium worth their peace of mind?

 

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