Updated . Educational only — not tax, legal, or lending advice. Confirm figures with your CPA, the state revenue department, and a lender before you close.
You Cannot Time an Aircraft Insurance Cycle
Aviation insurance moves in cycles because insurers and their reinsurers make or lose money, then tighten or loosen. A hard market means higher premiums, higher deductibles, and more aircraft or pilots they will not write. A soft market means the opposite. Neither one is a date you can put on a calendar. This page is the cycle. What the policy must say for a lender is on insurance requirements. How the premium hits the loan is on insurance and borrowing capacity.
What actually moves a premium
- The insurer’s recent losses and how much reinsurance they can buy.
- The aircraft: type, hull value, retractable gear, turbine, experimental, or a thin fleet.
- The pilots: total time, time in type, instrument currency, and recurrent training.
- The use. Personal Part 91, instruction, rental, and charter are different products.
- The field: hangared versus tied down, and claims on that tail.
What to do in either market
Get the quote before you waive a deposit, not after the lender asks for a binder. A hard market does not care that your purchase contract expires Friday. If the quote is declined, the loan is declined. Switching brokers in the same week can create duplicate submissions to the same underwriters, which annoys them and does not create a market. Ask your broker who has already seen the file.
Budget a range, not last year’s number. Put a low case and a high case next to the payment from the calculator. If only the low case is affordable, you cannot afford the airplane through a renewal.
Renewal versus a new purchase
A renewal is underwritten on your expiring policy plus this year’s hours and claims. A purchase is underwritten from scratch, often with a pilot who has zero time in type. Those are not the same premium. Training that you complete before the application is worth more than training you promise after the ferry.
Questions buyers actually ask
Does a soft market mean any airplane is insurable?
No. Experimental, warbird, and low-time turbine applications get declined in soft markets too. The cycle changes price and appetite. It does not delete underwriting.
Should I raise the hull value because the market is up?
Insure a value you would replace and that covers the loan. Inflating hull value raises premium and can fight the appraisal.