Flying a plane is exhilarating, but accidents can happen even to the most experienced pilots. Pilot life insurance provides peace of mind and important financial protection for your loved ones if there’s a tragic accident.
Finding the right life insurance policy for pilots can be tricky. Some insurance companies are more cautious with pilots which is why it’s crucial to work with an experienced broker who can help you obtain coverage. Continue reading to learn what pilots need to know about buying life insurance.
Table of Contents
- Can Pilots Get Life Insurance?
- Life Insurance for Private Pilots
- Life Insurance for Commercial Pilots
- Life Insurance for Students Pilots
- What Is an Aviation Exclusion Rider?
- The Best Life Insurance for Pilots
Unsure how much life insurance you need? Try our free and easy-to-use life insurance calculator.
Can Pilots Get Life Insurance?
In past years, it was challenging for pilots to find life insurance coverage. But as more research has come out, insurance companies have found pilots to be less risky to insure than previously thought. Statistically, pilots tend to be better educated, earn higher incomes, and are generally healthier than most Americans.
So, whether you fly private single-engine planes or large commercial planes, you shouldn’t have too much of an issue getting life insurance coverage.
However, it’s important to note that aviation isn’t the only thing life insurance companies care about. As part of the life insurance buying process, applicants go through underwriting. During this step, an underwriter evaluates your application as a whole. Your aviation history is reviewed in addition to other risk factors, such as:
- Overall health
- Family health history
- Lifestyle habits (e.g., tobacco, drug, or alcohol use; driving record)
After their review, you’re assigned a risk class. This ultimately determines what your policy will cost. The best possible risk class is Preferred Plus (see table below for reference).
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In general, pilots are good candidates for life insurance. But the type of pilot you are can impact your life insurance rates. Let’s dig into the differences between applying for life insurance as a private pilot and a commercial pilot.
Life Insurance for a Private Pilot
When compared to commercial pilots, private pilots carry a slightly higher risk. Life insurance companies want to know:
- Type of aircraft flown
- Purpose of flights
- Number of flying hours per year
- Type of license held
- Pilot’s experience
Research and statistics show that private pilots who fly more than 150 hours per year may present a significantly increased accident risk because of increased exposure, but pilots who fly less than 30 hours per year also present a significant risk due to their relative inexperience.
It’s possible that a pilot may be approved for life insurance but be required to pay a flat extra.
A flat extra is an additional premium charged on top of the base premium that covers the increased risk associated with an applicant. It’s usually a fixed amount per thousand dollars of coverage. These flat extras can last the entire policy term or just a few years, depending on the situation.
To better understand, let’s look at an example.
John Doe is a healthy 35-year-old private pilot with no accidents or violations. He expects to fly an estimated 250 solo hours annually. He applies for a 20-year $500,000 term policy.
He is approved at Preferred, but due to the high volume of flying hours, the life insurance company is requiring a $2.50 flat extra for two years.
So, for the first two years, John has to pay:
- Base annual premium = $306
- Flat extra ($2.50 x 500) = $1,250
Total annual payment for each of the first two years: $306 + $1,250 = $1,556 (approximately $130 per month)
After the first two years, the flat extra drops off, and John’s annual premium payment decreases to $306 (approximately $26 per month).
Life Insurance for a Commercial Pilot
Pilots of civil air carriers of major airlines in the U.S. have the most favorable underwriting among pilots. The reason is that, even though these planes are more complex, these airlines must follow the strictest set of rules governed by the Federal Aviation Administration. Pilots of such aircraft have a fatal accident rate 35 times more favorable than all types of pleasure flying combined.
Being approved for Preferred Plus as a commercial pilot is definitely not out of the question.
» Compare: Term life insurance quotes for pilots
Life Insurance for a Student Pilot
Finding affordable life insurance can be challenging for student pilots. However, at Quotacy, we have access to many life insurance providers, which means student pilots can not only get coverage but may also qualify for standard rates with no additional aviation penalties.
What Is an Aviation Exclusion Rider?
An aviation exclusion rider is a clause added to a life insurance policy that excludes coverage for death that occurs as a result of involvement in flying a plane. So, if you purchased a life insurance policy with an aviation exclusion rider and died as a result of cancer, the insurance company would pay your beneficiaries the full benefit. But if you died in a plane crash, the insurer would not be obligated to pay.
In the past, aviation exclusion riders were more commonly used, particularly in the early days of aviation when flying was considered much riskier than it is today.
As aviation technology has advanced and safety measures have improved, the risks associated with flying have been significantly reduced. This has led to a decrease in the use of aviation exclusion riders by insurance companies in recent years.
However, there are still situations today in which an insurance company will only offer coverage if there is an aviation exclusion rider attached. For example, if a private pilot has additional adverse risk factors, such as an aviation violation or history of epilepsy, life insurance carriers may require the aforementioned aviation exclusion rider.
The Best Life Insurance for Pilots
There are two categories of life insurance: term life insurance and permanent life insurance. Pilots are eligible for both.
Term life insurance lasts a specific length of time, typically 10-40 years. Permanent life insurance policies last your entire life.
Because life insurance is meant to replace your income for your family, term life insurance often makes the most sense because it provides protection during your prime earning years. It’s also far more affordable compared to permanent life insurance products.
However, there are many people that could benefit from permanent protection. For example, if you have a child with special needs that will depend on you their entire life, permanent life insurance may be essential.
Unsure which type of life insurance you need? Our guide may help: Do I Need Term or Whole Life Insurance? Differences, Pros & Cons
As a pilot, where you buy life insurance matters. No two life insurance companies underwrite exactly the same and some are more lenient with aviation than others.
In the private aviation example, while John Doe was offered Preferred with a flat extra for two years, another life insurance company may have wanted him to pay the flat extra for five years (a difference of $4,668 annually).
It’s recommended that pilots work with a life insurance broker. Brokers are not employed by any specific life insurance company. They have access to many different insurers and can shop around to find you the best life insurance option.
A benefit to working with Quotacy is that we are an independent broker, which means we have contracts with many different top-rated life insurance companies.
After you submit your online application, you’re assigned a dedicated agent who will review your application and ensure you’re matched with an insurer lenient with aviation.
As a broker, we have a duty to you, the customer. We’ll work hard to help you find coverage to protect your loved ones. If you’re a pilot and ready to get life insurance, start by getting a free term life insurance quote today.
Note: Life insurance quotes used in this article are accurate as of March 10, 2023. These are only estimates and your life insurance costs may be higher or lower.