Edition 1 – September 2025
Closing the gaps: Why aviation professionals need more than standard cover
Professional Indemnity in aviation matters now more than ever
By Melanie Daglish, Director of Aviation, ITIC
Professional indemnity (PI) insurance provides cover for aviation professionals for claims which are brought against them that allege responsibility for losses suffered by a third party as a result of their negligent acts, errors or omissions. As the aviation sector already benefits from a broad suite of insurance products and is a well-established buyer of cover, you may be asking: what additional value does a professional indemnity policy bring, and why should I be looking at it now, more than ever?
Let’s start with the basics. In insurance terms, professional indemnity is a “non-occurrence” based policy, meaning cover is triggered not by an event, but by an allegation of negligence. Specifically, it responds when a third party claims a loss due to your negligent acts, errors, or omissions. As my law lecturer always reminded me: context is everything, and no more so the case than here. In the aviation insurance market, an “occurrence” is defined as being something resulting in bodily injury or property damage. For most other aviation insurances, you need there to be an “occurrence” for your insurance cover to be triggered. This is not the case with PI, and because of this, it sits alongside – but does not replace – traditional occurrence-based policies (aircraft hull and liability, aerospace products liability, hangarkeeper’s liability cover, to name but a few). It plugs gaps in cover, and it can step in where they leave off.
ITIC’s aviation portfolio has experienced steady growth over the past decade, and during that time, it has become evident that many requests for PI insurance stem from contractual obligations; you want the business, but to secure it, you must demonstrate that you have PI insurance in place. As an insurer, this is encouraging news, since we realise you are under an obligation to take out some cover. However, this doesn’t necessarily help foster a clear understanding of what the insurance entails or why it exists, and this can do a disservice to the coverage. For example, did you know that you have a liability in tort to someone else for the sorts of losses that a PI policy would cover, even in the absence of a contract existing? Put another way, if you give poor professional advice and cause someone else a loss, the law will hold you accountable. Often, contracts will formalise this responsibility, but they don’t create it.
Any party acting in a professional capacity owes a duty of care to their clients. In aviation, this includes CAMOs, aircraft managers, charter and lease brokers, sales brokers, aerospace design and certification agencies, aviation surveyors, and ATOs. If the services you provide are alleged to fall short of the tortious duty to exercise reasonable skill and care, that liability must be defended. Where negligence results in a loss to another party, the injured party may seek to recover those losses, and a PI policy ensures that you have financial protection in place to respond adequately.
ITIC has defended CAMOs from claims for loss of use when an aircraft under their management was grounded to undergo unscheduled maintenance, as tasks had been omitted from scheduled maintenance work. ITIC also helped an asset manager when they were required to arrange and pay for the re-inspection of a fleet of aircraft engines, as the inspection services that they provided were initially carried out by an unqualified individual. Both of these were simple errors with costly consequences, and neither would have been insured under a traditional aviation insurance policy, as there was simply no occurrence to trigger a policy response.
As the world is becoming more and more litigious, not all claims will have merit; we’ve also helped an air charter broker to get rid of a meritless claim for negligent advice and poor carrier selection, at minimal cost and with minimal disruption to their day-to-day running of their business. ITIC has funded the defence of spurious claims against assureds in a variety of worldwide jurisdictions, including the USA and Canada. Stay tuned for more information about this in the next column.
Want to see how PI responds in real-world scenarios? Read ITIC’s latest case studies on claims involving air charter and cargo brokers, CAMOs, surveyors, aircraft managers and ATOs.
Please email ITIC@thomasmiller.com to get a copy of the latest Claims Review.
Professional indemnity (PI) insurance provides cover for aviation professionals for claims which are brought against them that allege responsibility for losses suffered by a third party as a result of their negligent acts, errors or omissions. As the aviation sector already benefits from a broad suite of insurance products and is a well-established buyer of cover, you may be asking: what additional value does a professional indemnity policy bring, and why should I be looking at it now, more than ever?
Let’s start with the basics. In insurance terms, professional indemnity is a “non-occurrence” based policy, meaning cover is triggered not by an event, but by an allegation of negligence. Specifically, it responds when a third party claims a loss due to your negligent acts, errors, or omissions. As my law lecturer always reminded me: context is everything, and no more so the case than here. In the aviation insurance market, an “occurrence” is defined as being something resulting in bodily injury or property damage. For most other aviation insurances, you need there to be an “occurrence” for your insurance cover to be triggered. This is not the case with PI, and because of this, it sits alongside – but does not replace – traditional occurrence-based policies (aircraft hull and liability, aerospace products liability, hangarkeeper’s liability cover, to name but a few). It plugs gaps in cover, and it can step in where they leave off.
ITIC’s aviation portfolio has experienced steady growth over the past decade, and during that time, it has become evident that many requests for PI insurance stem from contractual obligations; you want the business, but to secure it, you must demonstrate that you have PI insurance in place. As an insurer, this is encouraging news, since we realise you are under an obligation to take out some cover. However, this doesn’t necessarily help foster a clear understanding of what the insurance entails or why it exists, and this can do a disservice to the coverage. For example, did you know that you have a liability in tort to someone else for the sorts of losses that a PI policy would cover, even in the absence of a contract existing? Put another way, if you give poor professional advice and cause someone else a loss, the law will hold you accountable. Often, contracts will formalise this responsibility, but they don’t create it.
Any party acting in a professional capacity owes a duty of care to their clients. In aviation, this includes CAMOs, aircraft managers, charter and lease brokers, sales brokers, aerospace design and certification agencies, aviation surveyors, and ATOs. If the services you provide are alleged to fall short of the tortious duty to exercise reasonable skill and care, that liability must be defended. Where negligence results in a loss to another party, the injured party may seek to recover those losses, and a PI policy ensures that you have financial protection in place to respond adequately.
ITIC has defended CAMOs from claims for loss of use when an aircraft under their management was grounded to undergo unscheduled maintenance, as tasks had been omitted from scheduled maintenance work. ITIC also helped an asset manager when they were required to arrange and pay for the re-inspection of a fleet of aircraft engines, as the inspection services that they provided were initially carried out by an unqualified individual. Both of these were simple errors with costly consequences, and neither would have been insured under a traditional aviation insurance policy, as there was simply no occurrence to trigger a policy response.
As the world is becoming more and more litigious, not all claims will have merit; we’ve also helped an air charter broker to get rid of a meritless claim for negligent advice and poor carrier selection, at minimal cost and with minimal disruption to their day-to-day running of their business. ITIC has funded the defence of spurious claims against assureds in a variety of worldwide jurisdictions, including the USA and Canada. Stay tuned for more information about this in the next column.
Want to see how PI responds in real-world scenarios? Read ITIC’s latest case studies on claims involving air charter and cargo brokers, CAMOs, surveyors, aircraft managers and ATOs.
Please email ITIC@thomasmiller.com to get a copy of the latest Claims Review.
