Life Insurance for Pilots [Private & Commercial]

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There’s a common saying, “Every takeoff is optional. But every landing is compulsory”. For sure being an American pilot is not an easy job. It takes a lot of courage, skills, and experience to fly a plane or helicopter.

Of course! Serving the general public or a private wing to help them travel from one place to another requires great responsibility, and it is the first thing that runs in every pilot’s mind.

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But while playing your best role at the duty to ensure passengers’ safety, you cannot avoid the sanctuary and happiness of your own family. And that’s one of the main reasons why life insurance for pilots has become a necessity.

However, insurance firms are found to be extra cautious about approving pilots for a life insurance plan. Here’s a brief guide to help you understand and qualify for a plan.

Life Insurance for Pilots – Perspective of Companies

commercial vs private pilotNot long ago, insurance companies would straightly reject the pilot’s life insurance application. Or they were offered strict policies, which were only beneficial for the life insurers.

For instance, the pilot’s beneficiaries couldn’t claim for life insurance benefits, if the death resulted due to flying.

Moreover, insurance companies used to count pilots in the high-risk category without knowing their aviation experience, or health conditions. So even if any pilot was medically fit, he or she had to pay high premiums.

Fortunately, the scenario began to change, and insurance companies have now realized that there are only 1 out of 11 million chances of a plane crash.

This approach has made them amend their policies, as they have understood that there are greater chances of death while driving a car than flying a Boeing.

Furthermore, statistics reveal that pilots are more educated, receive a higher income, have fewer health issues than the rest of the Americans, and opt for maximum duration plans.

Nevertheless, despite insurance companies are now comfortable offering life insurance plans to pilots, they are still tight on judging the applicants through their health and fitness.

If you are healthy, then you are the most secured applicant for a life insurance firm.

Commercial Pilot vs. Private Pilot

Insurance firms have different rules for commercial pilots and private pilots. So, if you are willing to purchase a life insurance policy, then you have to answers a series of questions. In more technical words, you have to face the underwriting process to get your desired life insurance plan.

Life Insurance for Commercial Pilot

A commercial pilot is the one who is allowed by the Federal Aviation Administration (FFA) to fly aircraft for charter flights to transport passengers and cargo from one destination to another.

If you are a commercial pilot, then you are highly considerable for life insurance as compared to private pilots.

It is because commercial pilots are associated with airline companies. And therefore, they earn a higher income and in good health. These points qualify them for preferred life insurance premiums.

Underwriting for Commercial Pilot

As a commercial pilot, you are not considered risky by most insurance organizations. But you will have to answer a wide range of questions related to your work.

So, here are the most expected questions you might be asked during underwriting:

Q1. For how many years you have been working as a commercial pilot?

Q2. What are your average flying hours per year?

Q3. Do you fly transpacific/transatlantic, or long haul?

Q4. Do you pilot other aircrafts other than commercial flights?

Life Insurance for Private Pilots

Private pilots provide their services to private customers. They are hired by business executives, celebrities, and other elite personalities. These pilots are responsible for transporting their employers from city to city or country to country.

This is slightly different from commercial pilots. So as a private pilot, you are only eligible for the life insurance policy if you fly 30 to 150 hours annually.

And supposedly, you are piloting for less than 30 hours, then insurance firms will consider you ineligible due to lack of experience.

Conversely, flying for more than 150 hours per year will also cause rejection, as you will have increased chances of fatal accidents due to eminent exposure.

Underwriting for Private Pilots

Although the majority of questions asked to private pilots are similar to commercial pilots, you must prepare for tricky questions as well. The frequently asked questions include:

Q1. What aircraft you fly as a private pilot and why?

Q2. Why did you choose private piloting over commercial piloting?

Q3. How many years of experience do you possess as a private pilot?

Q4. What type of licenses or certifications do you acquire?

Q5. When was the last time you operated an aircraft?

Q6. Did you ever experience any incidents or accidents while flying?

And apart from all the above-mentioned questions, you must know that your insurance agent and underwriter will also check your professional background to see if you have been encountered in-flight incidents or FAA violations.

In case of any complaints, your application is rejected, or you may have to pay higher premiums for limited benefits.

So, whether you are a commercial pilot or a private pilot, don’t change your statement if you have been asked for accidents, as the underwriter must be well-informed about flying history.

Any false answer can be straight disapproval of your life insurance application.

Life Insurance Rating Categories for Pilots

Every insurance company has its policies when it comes to providing life insurance to a commercial or private pilot.

So it doesn’t matter if you are flying aircraft commercially or privately, you will be examined through similar risk categories, which will help you get a life insurance plan.

In other words, depending on your age, experience, health, and income you will be classified into the following categories:

  • Preferred Plus
  • Preferred
  • Standard Plus
  • Standard
  • Substandard

These categories help insurance firms to understand how low or high risks they may have if they will take you on board.

Preferred Plus

You are classified as a ‘Preferred Plus’ applicant if your health is in perfect condition. This means you are completely free from any major or minor diseases. Plus, your income is highly stable, and you have a positive working background.

Moreover, you have never consumed alcohol and tobacco. Also, falling into this category ensures that you have a greater life expectancy. Hence, you will enjoy maximum benefits and the lowest premium rates.

Preferred

If you are classified as a ‘Preferred’ pilot, then ultimately you will have to pay lower insurance premiums. However, this classification can be expensive as compared to ‘Preferred Plus’, as the insurance company will charge higher rates.

So being a ‘Preferred’ individual certifies that your health is excellent, and you are earning handsomely.

Standard Plus

You are a ‘Standard Plus’ pilot if you are going through one or two medical issues, but your overall health is normal. In simple words, if you are not suffering from any major or life-threatening diseases, your insurance provider will mark you for the ‘Standard Plus’ plan.

This risk category is costly if compared with ‘Preferred Plus’ and ‘Preferred’, but you are still safe from paying high premiums.

Standard

If you are encountering numerous medical problems or living a risky lifestyle, then you will receive a ‘Standard’ rating.

It means that you will have to pay more than the Preferred Plus, Preferred, or Standard Plus individuals.

However, you would still qualify for a normal life insurance plan. That means, you can enjoy the benefits but with higher premium charges.

Substandard

Substandard is the lowest category of all. It means that you’re extremely unhealthy, and have a lower life expectancy. Individuals who receive a ‘Substandard’ rating pay the highest premiums and receive minimum benefits.

It is because they are considered as ‘most risky’ insurance holders, therefore, the insurance organizations are at higher chances to incur a loss.

Nevertheless, as a pilot, you are likely to be categorized between ‘Preferred Plus’ and ‘Standard Plus’. In case, with the worst professional background and medical history, you are still left with two more options.

So, if you are planning to buy a life insurance policy as a pilot, make sure you focus on your health. It is the first thing that will help you get an A+ rating (Preferred Plus).

Also, try to maintain a good reputation at work, and don’t involve in hazardous activities or hobbies if you don’t want to fall into ‘Standard’ or ‘Substandard’ categories.

Best Life Insurance Plans for Pilots

Buying a life insurance policy is the best thing you can do for your family, especially if you are a pilot because your life is always at great risk. But despite several life insurance plans, pilots are limited to some most common offers.

The good news is that all these policies can be beneficial for your loved ones in case something happens to you at work.

On the other hand, you can also enjoy the financial perks if the tenure ends and you are still breathing.

So, as a pilot, here are your life insurance options you can choose from:

  • Term Life Insurance
  • Permanent Life Insurance
  • Variable Life Insurance

Term Life Insurance

Term life insurance stays functional for a limited time. So if you are dead during your selected period, your beneficiaries will receive the benefits.

And if you outlive the duration, your coverage will end and you’ll get your premiums back. However, there’ll be no extra monetary benefits then.

Permanent Life Insurance

Permanent life insurance, as the name suggests, is a life insurance policy with no expiry. This insurance type has different subtypes, but the most common ones offered to pilots are:

  • Whole Life Insurance
  • Universal Life Insurance

Whole Life Insurance

Selecting the whole life insurance policy means that you are required to pay the premiums for the entire life and your beneficiaries will receive the benefits after you have left the world.

In this insurance, premium rates are locked at the very beginning.

This means you have to pay the same amount for the rest of your life, and you cannot change it. Moreover, the premium rates depend on your age and health. So the healthier and younger you are, the cheaper your premium payments will be.

Universal Life Insurance

Universal life insurance is a lot different from whole life insurance. It is more convenient when it comes to the death benefit and premium payments. Also, the investment feature in this policy helps you save more money, which can be later enjoyed by your beneficiaries.

In a universal life insurance plan, you are also free to change the frequency and premium amounts right after paying the first due.

On the other hand, it comes with a variation called ‘Indexed Universal Life Insurance’, which permits you to invest cash in the stock market. This simply means that you can try your luck by trading on various platforms, such as Nasdaq.

Variable Life Insurance

Variable life insurance is similar to permanent life insurance but with an investment option. You can utilize the cash value by investing the amount in multiple subaccounts.

As a result, you can enjoy increased profits. But contrarily, you will also have to bear the loss.

As you have observed some popular life insurance policies available for pilots, it is vital to know that most insurance companies recommend universal life insurance.

Pilots also feel attracted to a universal life insurance plan, as they get high flexibility and advanced benefits.

Note: Life insurance providers will assess your ratings before offering the plans. Your premiums and benefits will be decided on how good or bad your ratings are.

So, try your best to fall into the ‘Preferred Plus’ category, or at least, the ‘Standard Plus’ category because anything below these two plans might not completely fulfill your desires.

Things Pilots Must Know When Buying Life Insurance

As a pilot, purchasing a life insurance policy can be tiring because a few honest mistakes can increase premium rates and decrease benefits.

There have been many cases when an extremely healthy pilot has been offered with a high premium price, as compared to the pilot with an average health condition.

It is because insurance organizations still decide premium rates on limited, and sometimes, outdated aviation security statistics. And as a consequence, pilots are penalized with unreasonable rates for their life insurance coverage.

But there are a few things you can do to rescue yourself from being mishandled, such as:

Choose an Experienced Aviation Insurance Agent

Always prefer an experienced aviation insurance agent over an ordinary policy seller. Why? It is because he or she can help you in the best possible through experience and industry knowledge.

A well-informed insurance agent can quote you accurately by understanding the aircraft type you usually fly. Similarly, he or she can help you rectify several loopholes, which can later become the main cause of high premium rates.

Understand Application Guidelines

Each insurance company has set its aviation insurance rules. These guidelines are strict and unchangeable. This is why it is essential to know about the terms and conditions your insurance provider has fixed. For instance:

  • Most US insurance companies will not consider you for ‘Preferred Plus’ unless you are piloting on a regularly scheduled airline (US-based only)
  • Private pilots with no ratings and less than mandatory flying hours have to pay extra insurance fee or an Aviation Exclusion Rider
  • Employer-sponsored plans do not pay death coverage as they are deemed as general aviation
  • Flying activities, such as ultralights, aerobatics, and experimental aircraft increases your premium rates

These are just a few rules and there could be many more which certainly need your attention.

Fill the Aviation Insurance Form Correctly

When you will apply for a pilot life insurance policy, the insurance firm will ask you to fill an aviation questionnaire.

It is the same underwriting process you have read in the above section, and it needs to be filled with a lot of concentration. A minor mistake can increase your life insurance premium rates.

Some of the most common mistakes made by pilots are:

  • Pilots are unable to state their Certified Flight Instructor (CFI) ratings
  • Pilots, who have completed their attitude training, are usually found marking ‘YES’ on the aerobatic flying question
  • Pilots don’t care much to mention about the aircraft they have been flying

So, these are some out of many blunders pilots make when they fill the form. So try your best to avoid making errors to enjoy minimum premium rates.

Tips to Qualify for Life Insurance

As a pilot, you can qualify for a life insurance policy by following simple steps:

  • Find the right insurance company that is prominent among your fellow pilots
  • Always disclose your complete medical history
  • Try to control your smoking habit
  • Exercise regularly because when you’ll weigh less, you’ll pay less

Things to Do Before Medical Exam

No matter how intelligent and well-experienced private or commercial pilot you are, you can never have a life insurance policy if you fail in medical checkups.

Your life insurance company will ask you to cooperate for a complete medical test. Therefore, it’s better to start preparing yourself for the big day.

Here’s what you need to do:

  • Try to take at least 8 hours of sleep
  • Eat healthily and consume water instead of fizzy drinks
  • Avoid smoking, alcohol, and caffeine-based supplements, such as coffee
  • Limit your salt and sugar intake
  • Take part in physical activities to control your cholesterol and fat levels

There was a time when pilots weren’t entertained by life insurance companies. The organizations were uncomfortable, as they believed that providing life insurance to them could be extremely risky.

But things changed with time, and now pilots can savor life insurance policies.

Final Verdict

Purchasing life insurance for pilots requires excessive consideration. Although some fundamental prerequisites are different for private and commercial pilots, the rests of the rules are similar.

So, with proper instructions and knowledge, all the demands can be fulfilled, and as a pilot, you can qualify for a suitable life insurance plan.