We've just completed two important tasks - we've renewed our insurance for the next year, and determined our new deductible levels. This article will explain the new year's requirements.

First, many of you are aware of the impact that September 11 had on the insurance industry. The incredible cost of payouts for the destruction done was immense, and affected the entire insurance industry. No policy or company was likely to be immune to that effect.

The next important aspect of our renewal has to do with our ability to reduce incidents/losses, and manage those we do have. Over the past year, we've been very fortunate, and very lucky in most respects, and surprised (unpleasantly) in others. While our loss to premium ratio was relatively low, this is in part due to the fact that the Club chose to "eat" some of the losses, rather than report them to our insurance company. Just like when you ding a fender in your car, losses affect your insurance costs, and companies look at the trend over a several year period.

Our major incidents were few - a prop strike in a Citabria among them, but our minor incidents were several and avoidable. Of late, the bulk of our damages have been due to taxi accidents. Of the two causes of accidents, mechanical or pilot error, it's pilot error that occurs with far greater frequency. We've had a rash of planes taxiing into fixed objects - clearly an incident which can be avoided. Some were just bad judgment, and some were egregious in their lack of proper operation.

The Club has processes and methods designed to minimize both types of incident causes. In MX, we have many procedures, including a double-check system so that every piece of work is viewed by at least two sets of eyes. On the pilot side, our CFIs have many procedures as well, including phase checks. Our currency requirements and enforcement, while sometimes appearing stiff, are applauded by the insurance companies as a primary means to ensure that good judgment is used as often as sharp skills are.

Even with these processes and tools, we have the occasional lapse which costs us all. Higher premiums mean higher costs to fly, and decreased likelihood of flexibility. Our last year, as mentioned, was strong in preventing significant losses, and several organizations are using us as a model for how to infuse as much safety as possible into the process.

Our coverage remains as it was last year for limits: $1,000, 000 coverage, with $100,000 per seat. This is known as 1 Million/sub 100. In addition, we continue to have the no-subrogation clause, which means that the policy acts as your defender and you are protected from an injured party going after you directly. This year we also add a $5,000 medical coverage component. For details on these limits, please email me at gm@wvfc.org.

Now for the deductible side of the house. After consultation with the insurance company, and the Board, we're announcing a deductible policy designed to increase care and concern, and allow us to meet our goal of reducing losses and increasing safety awareness and practice:

For any accident/incident/loss in which the finding of the Director of Flight Safety is significant pilot error/negligent operation, a deductible maximum of $5,000 will apply.

For any accident/incident/loss in which the finding is not significant pilot error/negligent operation, a deductible maximum of $3,500 will apply.

In order to better understand, let me give you two hypotheticals:

1. A Club Member taxies a plane away from a taxiway, attempts to taxi into a tiedown, and strikes a fixed object. Because Club rules specify taxiing on a taxiway, and do not allow a Member to taxi into a tiedown, a deductible of up to $5,000 will apply. If the damage is only $3,000, then the Member is only required to pay $3,000. If the damage exceeds $5,000, then the Member will be liable to pay the $5,000.

2. A Club Member is taxiing on a taxiway, and taxies across broken glass. The tire goes flat and the plane lurches into another aircraft. In this case, unless the taxiway was covered in glass (where the Member would be expected to notice and avoid), the deductible amount of $3,500 would apply.

The intent here is to encourage safe and responsible operation. When an egregious error in judgment occurs, the cost is to every member. Because the vast majority of our members DO operate safely, we don't want to see those members subsidizing the bad judgments of a very few. By the same token, a lapse in judgment does not always imply a poor pilot, and therefore we do not look to be punitive.

Finally on this subject, we strongly encourage you to consider Renters Insurance. This additional coverage would be available to cover your deductible as well as increase the limits above and beyond our policy. Avemco, among several others, has this policy available. Many members today have this coverage and it is well worth the cost to cover the unpleasant eventuality of being faced with a loss.

Please let us know if you have questions on this - we can involve Chris Zanette, our insurance broker, who's also a Club member.

Finally, we would like to thank Chris for his strong and diligent efforts in representing the Club and our safety record, and bringing us through another successful renewal.