BasicMed and the Insurance MarketplaceBasicMed and the Insurance Marketplace

BasicMed is just around the corner, so we thought it would be an excellent time to update everyone on how the insurance marketplace will approach the new regulations.

Pilots were understandably anxious to hear the details when BasicMed was first announced and now that the specifics have emerged, many are wondering, “What about the insurance carriers?” Well, here we go…

Starting with our non-owned carrier – and we’ll begin with great news. They will accept BasicMed in place of a medical! In fact, this product has been used for years by Sport Pilots, so allowing BasicMed is an easy transition.

In terms of insurance for aircraft owners, we are very happy to announce nearly every one of our core carriers will gladly accept BasicMed in place of a medical.  Now there are a couple of carriers  taking a wait and see approach, and medicals may still be required for those requesting high liability limits, transitioning into high performance or pressurized aircraft, but for the vast majority of pilots, BasicMed will be accepted by their insurance companies.

So a common follow-up question is, “You said that most carriers will accept BasicMed, but you didn’t mention anything about rates.” Fair enough. Allow me a few quick sentences to briefly describe how rates are derived - then we’ll specifically address how it relates to BasicMed. While rates are determined by dozens of factors…generally it all boils down to two major points: 1) losses experienced by companies insuring certain categories of pilots or aircraft and 2) competition. The competition part is easy – the more competition, the higher the pressure on rates – and believe me, for many aircraft, there’s plenty of competing carriers. And on losses, carriers must justify why aircraft X costs more than aircraft Y, if all things are equal (seats, horsepower, availability of parts, etc.) and how they do that is through analyzing historical losses. If aircraft X, for whatever reason, results in higher losses than Y, rates will be adjusted accordingly. For example, there are times when we receive inquiries from some highly experienced pilots, sometimes with thousands of hours, and have to explain why an insurance rate is higher than expected…typically it’s not because of them, it’s because of that particular aircraft or their desired use of the aircraft. In fact, without their experience, many times we wouldn’t have been able to obtain a quote at all!

So back to BasicMed, knowing how rates are derived, carriers have told us that rates will not increase because of this new rule. Now, does that mean forever? Of course not because if additional losses start to occur, rates will adjust accordingly. However, no one, foresees that happening…why? It’s because it didn’t occur with the light sport market – and that’s been around for more than a decade! Pricing summary – no foreseeable rate increases as a result of BasicMed!

Please know that most carriers are still going to want to know your BasicMed date – when you completed the requirements.

Whether you rent or own, AOPA Insurance has the right policy for you.  For more information or to apply for a policy, visit  Don’t forget:  You may qualify for a 5% discount just for being an AOPA member and revenue from AOPA Products & Services goes right back to supporting, growing, and protecting general aviation.

Jim Pinegar

Jim Pinegar

Vice President & Director of Operations of AOPA Insurance Services

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