Insurance Premium Increase

[jonhop]

I received this ominous note from my insurance carrier. This is following an increase from last year. Looks like it's going to be another tough year of increased premiums. Guess I'm going to have to start shopping around a bit more.

[MikeOH]

Oh, joy.  I have Global, as well...November renewal is coming up fast, I'm afraid.

[jonhop]

 

1 hour ago, MikeOH said:

Oh, joy.  I have Global, as well...November renewal is coming up fast, I'm afraid.

Interested in the damage when you get the quote...

[MooneyMitch]

Global is offering me a modest 38% premium adjustment.

[MikeOH]

9 minutes ago, MooneyMitch said:

Global is offering me a modest 38% premium adjustment.

This line from "Liar, LIar" comes to mind, "I'm just going to bend over and take it up the tailpipe."

Edited September 26, 2020 by MikeOH

[chriscalandro]

I think the problem is that there aren’t enough insurance increase threads and the insurance companies are missing them. 

[jonhop]

5 minutes ago, MooneyMitch said:

Global is offering me a modest 38% premium adjustment.

That's harsh. 

[MooneyMitch]

This is a beautiful example of Capitalism at its finest !

[MooneyMitch]

7 minutes ago, MikeOH said:

This line from "Liar, lLar" comes to mind, "I'm just going to bend over and take it up the tailpipe."

I just purchased a large jar of der vennie schlider ........

I guess I’ve just had it too good for too long 

[MooneyMitch]

4 minutes ago, jonhop said:

That's harsh. 

Ya think? 

[Nukemzzz]

I received a similar letter from my company and it’s time to start preparing for next year. 

[MooneyMitch]

With all this, I still consider it a great privilege to fly an airplane.

I will continue to do it till I can’t.

[RobertGary1]

Aviation insurance hasn’t been very profitable the last few years.     Several underwriters have just up and left. 
 

-Robert 

[MikeOH]

16 minutes ago, MooneyMitch said:

With all this, I still consider it a great privilege to fly an airplane.

I will continue to do it till I can’t.

True enough.

Thing is, even with my present policy I won't carry passengers except my family.  My policy limits are only $100K per seat.  A $1 million smooth policy would double my premium  It's just not worth it as much as I'd like share aviation with others.

At some point the insurance companies WILL lose me as a customer as I will just go naked.  If you look at the cost of a liability ONLY policy for $1 million it is dirt cheap; like $300 per year.  That tells me the actual risk of damaging people and property on the ground is really low.  In the twilight of my flying life if I total the plane I can walk away from the hull loss.  (Assuming I'm not a total loss, too)

[MikeOH]

Just now, RobertGary1 said:

Aviation insurance hasn’t been very profitable the last few years.     Several underwriters have just up and left. 
 

-Robert 

Hmm, do we have any actual proof of that, or is that just what we are being told?

[RobertGary1]

1 minute ago, MikeOH said:

Hmm, do we have any actual proof of that, or is that just what we are being told?

Proof that several underwriters have left? 
 

-Robert 

[MooneyMitch]

8 minutes ago, RobertGary1 said:

Aviation insurance hasn’t been very profitable the last few years.     Several underwriters have just up and left. 
 

-Robert 

I may be mistaken, but I believe Parker has addressed this in a previous thread.

After all, insurance is a business and a business has to be profitable in order to stay in business.

[MikeOH]

4 minutes ago, RobertGary1 said:

Proof that several underwriters have left? 
 

-Robert 

That doesn't prove that the aviation insurance business is "not very profitable."  Some may have left because they are no longer making as much as they would like.  I'm just not believing they will starve unless they raise our premiums 40+% in a single whack!

[RobertGary1]

16 minutes ago, MikeOH said:

That doesn't prove that the aviation insurance business is "not very profitable."  Some may have left because they are no longer making as much as they would like.  I'm just not believing they will starve unless they raise our premiums 40+% in a single whack!

They have to make enough profit on their inverters money to make it worth their wile to do.

If they’re leaving good profit on the table than you’d be able to jump in and get rich  

-Robert 

[MikeOH]

1 minute ago, RobertGary1 said:

They have to make enough profit on their inverters money to make it worth their wile to do.

If they’re leaving good profit on the table than you’d be able to jump in and get rich  

-Robert 

If there is so much money to be made elsewhere (investor ROI), why haven't ALL of them left for greener pastures?

My cynicism in all of this is that we aren't being told the real reasons for the giant hikes in our premiums.  At this point my belief is that the small GA aircraft market has pretty well established, and stable, loss ratios.  The idea that accidents in this market have taken such a sudden increase as to justify the new premiums doesn't pass the sniff test.  I think we are subsidizing a couple of LARGE losses in the air carrier market: namely the Boeing MAX debacle.

[RobertGary1]

17 minutes ago, MikeOH said:

If there is so much money to be made elsewhere (investor ROI), why haven't ALL of them left for greener pastures?

 

Once one or two leave there is less competition so rates can increase and then there is enough profit. If too many underwriters are fighting for a fixed number of customers rates go down.  It’s kind of a game of who can hold their breath the longest. 
 

-Robert 

[MikeOH]

Just now, RobertGary1 said:

Once one or two leave there is less competition so rates can increase and then there is enough profit. If too many underwriters are fighting for a fixed number of customers rates go down.  It’s kind of a game of who can hold their breath the longest. 
 

-Robert 

That's certainly the normal way competition works; and the rates fluctuate accordingly.  Seeing 40%, and higher, rate hikes in a single year is NOT normal fluctuation.  I remain convinced we are subsidizing losses that are NOT in our market.  Sorry, not buying the rates are due to a sudden plethora of old guys performing gear-ups.

[RobertGary1]

1 minute ago, MikeOH said:

That's certainly the normal way competition works; and the rates fluctuate accordingly.  Seeing 40%, and higher, rate hikes in a single year is NOT normal fluctuation.  I remain convinced we are subsidizing losses that are NOT in our market.  Sorry, not buying the rates are due to a sudden plethora of old guys performing gear-ups.

But for that to work they’d have to collude. Otherwise if one raises their rates the others will just take their customers. Doesn’t seem like it would be worth prison to collude. 
 

-Robert

[MikeOH]

Just now, RobertGary1 said:

But for that to work they’d have to collude. Otherwise if one raises their rates the others will just take their customers. Doesn’t seem like it would be worth prison to collude. 
 

-Robert

Not following why any collusion is required???  If the carrier/underwriter that insures small GA also is insuring Boeing and they raise our rates astronomically to pay for loss payouts to Boeing I'm not seeing any collusion.

[RobertGary1]

4 minutes ago, MikeOH said:

Not following why any collusion is required???  If the carrier/underwriter that insures small GA also is insuring Boeing and they raise our rates astronomically to pay for loss payouts to Boeing I'm not seeing any collusion.

Because if there is profit at lower rates one would break away and steal everyone’s business by rating politics 10% less than everyone else and taking all the profit for themselves. 
 

-Robert