Airport Insurance Requirements

"This report provides best practices for airports developing an insurance program, including requirements for contracts with third parties doing business at the airport. This guide was developed for airport risk management personnel and includes the findings from a nationwide survey of airport risk managers and interviews with airport risk managers, commercial aviation insurance brokers, and commercial aviation insurance underwriters specializing in airport insurance" -- Publisher's website

A substantial proportion of all domestic aviation accidents and fatalities that occur each year involve general aviation (GA), which includes all aviation except commercial and military. Under federal law, the Secretary of Transportation is responsible for ensuring that commercial air carriers carry liability insurance. However, no such federal requirements exist for GA aircraft owners. In some cases, accidents involving uninsured or underinsured GA aircraft owners have occurred where individuals (passengers or third parties) who incurred losses received little or no compensation. This book examines existing liability insurance requirements for GA aircraft owners; premiums for GA liability insurance; and factors that selected stakeholders cited which should be considered in determining whether to adopt a federal liability insurance requirement. Furthermore, this book discusses the characteristics of and trends in general aviation accidents from 1999 through 2011; and recent actions taken by the Federal Aviation Administration (FAA) to improve general aviation safety.

TRB's Airport Cooperative Research Program (ACRP) Report 33: Guidebook for Developing and Managing Airport Contracts is a guidebook of best practices for developing, soliciting, and managing airport agreements and contracts for use by a variety of airports. The agreements referenced in this guidebook range from airline-related agreements to communication and utility service as well as common-use, ground transportation, and concessions agreements for a variety of passenger services. An accompanying CD-ROM provides sample agreements in each of these areas. The CD-ROM included as part of ACRP Report 33 is also available for download from TRB's website as an ISO image. Links to the ISO image and instructions for burning a CD-ROM from an ISO image are provided.

ACRP report 47 explores issues associated with developing and leasing available airport land and summarizes best practices from the perspective of the airport sponsor. The guidebook includes a diverse set of case studies that show several approaches airports have taken to develop and lease property for both aeronautical uses and non-aeronautical uses. The project that developed the guidebook also produced two presentation templates designed to help airports in effective stakeholder communication regarding developing and leasing airport property. The templates, designed for a non-technical audience, provide content, examples, and definitions for a presentation to community stakeholders. The templates, one for aeronautical use development presentations, and the second for non-aeronautical use development presentations are available only online.

Pursuant to a congressional requirement, GAO reviewed the Federal Aviation Administration's (FAA) Aviation Insurance Program, focusing on: (1) whether sufficient funds are available to pay the insurance claims; (2) how FAA war-risk coverage compares with that of commercial insurers; and (3) how FAA administers the program. GAO found that: (1) the Aviation Insurance Program does not have sufficient funds available to pay potential insurance claims for many of the aircraft registered for the program; (2) FAA inability to pay a claim promptly could cause a financial hardship for the affected airline, jeopardize other airlines' confidence in the program, and reduce the airlines' willingness to provide needed airlift services; (3) FAA insurance policies do not specifically provide the same comprehensive coverage as commercial insurance policies; (4) although FAA recognized the need to revise its war-risk policies as early as May 1990, it did not complete new nonpremium policies until April 1994 and still has not established a date for issuing its new premium policies; and (5) weaknesses in the administrative process could hamper the program's effectiveness and result in delays in claims payment.

Introduction -- Consortiums studied -- Scope of responsibilities -- Governance -- Membership -- Contracting methods -- Operations and administrative management -- Performance standards -- Capitalization -- Operating budgets -- cost allocation -- Pros and cons -- Lessons learned -- Conclusions.