Sport Pilot Talk

There has been considerable discussion in another thread about converting S-LSAs to E-LSAs, and the issue of insurance implications has come up (most recently at http://sportpilottalk.com/viewtopic.php?p=14506#14506). The operative question is: does it cost more to insure an E-LSA than it does an S-LSA? Would insurance issues enter into a decision to convert from one category to the other?

I recognize that my knowledge of insurance rates for experimentals is limited to the E-AB category, and that E-LSA may be too new, the industry too immature, to draw conclusions. But, what are people's experiences?

A related question is suitable physical damage coverage. Obviously, one likely can't insure a homebuilt (of any stripe) for what it's actually "worth" (in terms of the builder's sweat equity). So, a $120,000 S-LSA may be insured for that amount, while the E-LSA kit version of the same aircraft should be insured for -- what? The actual cost of the kit? Some perceived market value? Some other figure?

When we compare insurance costs between factory-built and experimental, we need to normalize the price as a function of insured value. Bob Mackey, if you're lurking here, your wisdom and experience will be useful to us all.

Good idea to start this thread, Paul - thanks!

For those who want to sample what the only existing group of E-LSA owners have experienced re: insurance rates, I'll post links below to a few threads from RV-12 owners over at the Vans Airforce forum that should provide some interesting reading.

Keep in mind that we have two factors working in combination for the RV-12 crowd: the additional cost of flying an 'experimental' (even tho' built to a standardized form) AND the lousy accident record of not just experimentals as a group but also of LSA a/c (almost all of them S-LSA a/c). I've heard that premiums do come down as an owner builds time in an LSA and gets beyond the initial 'transition' issues and losses.

FYI here are a couple of rate examples:
"Check with the EAA. Mine was about $1800 for $60K [hull value]. With zero hours in the RV-12, 10 hours total the previous 25 years. Had 200 hours from 1970-1985."
"Like Marty, I insured for $60k. I have over 2,000 hours logged. I am at $1500 for that much."

The most recent thread, which dips into related issues as well, is:

http://www.vansairforce.com/community/s ... =insurance

Also:

http://www.vansairforce.com/community/s ... =insurance

http://www.vansairforce.com/community/s ... =insurance

FWIW here's an interesting, recent note about relative rates for different kinds of coverage as well as USING one's LSA insurance:
"Rick McBride (RV-8) and I (RV-4) both built Rans S-7S Couriers and had them displayed at the Rans commercial booth at Sun n Fun this year when the tornado decided to deposit them on top of and under a couple of new Pipers displayed at the booth next door. Both planes were totaled by the insurance company. I had $70K flight and ground coverage. My premium was $1391 for the full coverage. The premium would have been $817 for ground only damage coverage, and $307 for liability alone. We both bought our salvage back from the insurance company and are in the process of having Rans rebuild our planes at their factory in Hays, KS."

Thanks again, Paul.

I am thinking about an option to convert my S-LSA to an E-LSA. One of the open questions is what is the impact of it on insurance rates. Does anyone have any recent experience with this?

Dave C wrote:I am thinking about an option to convert my S-LSA to an E-LSA. One of the open questions is what is the impact of it on insurance rates. Does anyone have any recent experience with this?

My experience has been it makes no difference.

Not recent, but in 2009, when I converted mine, my rate actually went down a bit. However, that was primarily because as an Experimental they would only insure the hull for $50k, down from the $60k (I think) I had insured it for prior. Bear in mind at the time a Sky Arrow like mine sold for $75.5k nicely equipped.

Just one data point, but I think most have found no major change in rates after converting. A call to your broker should clear things up.

When in doubt, ask your insurance broker. They are the experts, and should be able to tell you what (if any) difference it will make.

For what it's worth, I recently sold a 1965 Champion 7ECA (early Citabria) that had a hull value of $21,000, and replaced it with my current RANS S-6ES that has a hull value of $40,000 (roughly twice as much). The hull insurance went up very slightly (cost per $1000 of coverage was 8% higher), but that was a good bit less of an increase than I was expecting, given the massive complaints from so many pilots about their hull coverage costs going through the roof over the past year or so...

The liability portion of the coverage ($1MM/$100K) is about 70% higher for the E-LSA than it was for the "certified" Citabria. I'm not sure if this is purely a reflection of the "higher risk" aspect of experimental aviation, or just the overall insurance cost increases this year. But to keep that in perspective, we're talking $253 for the RANS versus $149 for the Citabria (for just the liability portion).

I converted my Zodiac from S-LSA to E-LSA in November, 2016. Same insurer, same coverage, annual premium before and after:

Before converting: $826

After converting: $924

Clearly a negligible increase, Stan. But, what's your insurance up to now?

Thanks all. That is good to hear it doesn't seem to make much difference. I'll be sure to check with my agent to confirm before I make a final decision to go E-LSA.

Well I was just about to go E-LSA. I had a DAR lined up and I was ready but I got a quote on insurance and it ended up being a big deal. It would be a 77% premium increase for the same coverage. I am currently paying $1085/yr with my Sportstar as an S-LSA. As E-LSA the rate is $1923/yr.

Dave C wrote:Well I was just about to go E-LSA. I had a DAR lined up and I was ready but I got a quote on insurance and it ended up being a big deal. It would be a 77% premium increase for the same coverage. I am currently paying $1085/yr with my Sportstar as an S-LSA. As E-LSA the rate is $1923/yr.

More than likely this is because of the rate increase across the board for aviation insurance not because you are converting to E-LSA. Call a broker and shop around, there's more than one game in town for insurance these days.

I am working with a broker (Falcon). The $1085 is a rate from a couple weeks ago. The $1923 is from 1 week ago, both are the lowest rates the broker could find and they are directly comparable. This is not what I expected.

My rate last year was $1400.

Well, I would expect ELSA to be a bit higher since , at least theoretically, there is a greater risk involved with a plane that could have been potentially modified in ways that don't necessarily promote safety ... but by that much ?

Warmi wrote:. . . . at least theoretically, there is a greater risk involved with a plane that could have been potentially modified in ways that don't necessarily promote safety . . .

Can you provide us some verifiable data which supports your assertion?

Wm.Ince wrote:

Warmi wrote:. . . . at least theoretically, there is a greater risk involved with a plane that could have been potentially modified in ways that don't necessarily promote safety . . .

Can you provide us some verifiable data which supports your assertion?

How about applying some logic to the situation?

The S-LSA must be maintained in accordance with published specs and data, using factory-supplied manuals and procedures. All the maintenance and inspections must be performed by a licensed mechanic (LSR-M, A&P, or A&P/IA). That means the risks are well understood.

An E-LSA (such as the one I own and fly) is just like any other Experimental airplane. Literally ANYONE can work on the airplane, and the inspections can be signed off by any of the above, or by the owner/operator – provided they attend the training and receive the LSR-I rating (as I just did). Unlike the S-LSA, if I want to remove the Rotax 912ULS and install a Jabiru 3300 or even a Harley-Davidson motorcycle engine, I can do so without consulting or gaining approval from the airplane's designer / manufacturer. If I want to change the flap mechanism from a "johnson-bar" to electric, I can do that also. If I had a plane with balanced ailerons and I decided to replace them with unbalanced ones, I could to so. (It would be purely stupid, but I could legally do so, as long as I flew off the 5-hour test period specified in my Operating Limitations).

So, which of the above incurs more risk to an insurer? Clearly, the E-LSA carries the potential for significantly higher risk. That doesn't necessarily mean that the "actuarial history" proves the risk is real, but the insurance underwriter has to make their "best guess" about what will happen in the future, and base their rates upon that.

My E-LSA has higher insurance premiums than it would if it were an S-LSA, and I'm fine with that.