Specialty Aviation Underwriters, LLC

Transcription

1 Specialty Aviation Underwriters, LLC Policy Summary Page Policy Number: The Policy Summary Page with the attached policy, and any forms and endorsements we issue, completes your insurance policy. ITEM 1. POLICYHOLDER NAME AND ADDRESS Your Insurance Agent's Name and Address Policyholder is a Corporation. ITEM 2. POLICY PERIOD Your Policy Period is from to beginning and ending at 12:01 AM Local Time at the address shown in Item 1 above. ITEM 3. AIRCRAFT LOCATION You keep your aircraft principally in the State of ITEM 4. DESCRIPTION OF AIRCRAFT FAA Number Year Aircraft Manufacturer and Model Total Seats Aircraft Type ITEM 5. COVERAGES AND LIMITS Subject to the limitations, conditions and exclusions of your policy, the most we will pay under the coverage we provide is shown below for each aircraft. Where no amount is shown, no coverage is provided by your policy. The limits may be altered by any attached forms or endorsements. Coverage A - Aircraft Physical Damage FAA Not in Motion In Motion/Ingestion Number Type of Coverage Agreed Value Deductible Deductible Coverage B - Liability to Others. FAA Number Type of Coverage Limits of coverage Coverage C - Passenger Medical Expense PASSENGER MEDICAL EXPENSE LIMITS Each Person Each Occurrence ITEM 6. APPROVED USES - Your aircraft may only be used for the "Approved Uses" shown below: With respect to, Personal Use. Personal use meaning your personal pleasure and business related use, provided no charge is made other than for "Direct Operating Costs" as defined in your policy. Policy Summary Page Page 1

2 Specialty Aviation Underwriters, LLC Policy Summary Page Policy Number: ITEM 7. APPROVED PILOTS - During each "Approved Use" as defined in Item 6, the aircraft must be operated in-flight only by the "Approved Pilots" shown below who must have a current and proper (1) medical certificate and (2) pilot certificate with necessary ratings as required by the FAA for each flight. There is no coverage under the policy if the pilot does not meet these requirements. ITEM 8. WHOM WE WILL PAY - Payments for loss under "Coverage A - Aircraft Physical Damage" will be made to you and: ITEM 9. THE FOLLOWING FORMS AND ENDORSEMENTS ARE ATTACHED AND FORM PART OF YOUR POLICY: SAU Full Premium Due In The Event Of A Loss, SAU Defense Cost Removed From Liability Limits, SAU Deletion of "Family Member" Limitation of Liability Sublimits, SAU Endorsement Restricting Passenger Liability Limits ITEM 10. POLICY PREMIUM. Policy Premium: Florida Surcharge: Total Amount Due: This Policy is provided by: OLD UNITED CASUALTY COMPANY (d/b/a VANTAGE CASUALTY COMPANY in the State of California) A Kansas Corporation, incorporated in Shawnee Mission Parkway Mail: Post Office Box 795 Merriam, Kansas Shawnee Mission, Kansas Countersigned By At Date (Authorized Representative) Policy Summary Page Page 2

3 Specialty Aviation Underwriters, LLC Endorsement FULL PREMIUM DUE IN THE EVENT OF A LOSS Regardless of any provision in your policy to the contrary, in the event we pay for any physical damage to your aircraft, the full annual physical damage premium for your aircraft becomes fully earned by us. In the event that you have not paid us the full annual premium, you must do so at the time we pay for the physical damage. This endorsement shall apply to the following aircraft : All Aircraft NOTHING HEREIN CONTAINED SHALL BE HELD TO VARY, WAIVE, ALTER OR EXTEND ANY OF THE TERMS, CONDITIONS OR AGREEMENTS OF THE POLICY OTHER THAN STATED ABOVE. Policy Issued to: Endorsement No. Policy No. Date and hour endorsement takes effect Approved: Specialty Aviation Underwriters, LLC By: SAU Page 1

4 Specialty Aviation Underwriters, LLC Endorsement DEFENSE COST REMOVED FROM LIABILITY LIMITS Part Four of your policy is deleted in its entirety and the following provisions are substituted: PART FOUR DEFENSE, SETTLEMENT AND SUPPLEMENTAL PAYMENTS If you bought coverage under PART THREE, we have the right and duty to defend any suit against you or anyone we protect for bodily injury or property damage that is covered by this policy. This applies even if the suit is groundless, false, or fraudulent. We may investigate, negotiate or settle any claim or suit as we deem necessary. Defense costs are not included and are not a part of the Liability Limit as stated in the each occurrence Liability Limits listed on the PSP under Item 5, COVERAGE AND LIMITS, COVERAGE B - Liability to Others. The defense costs are in addition to the Liability Limit as stated in the each occurrence Liability Limits listed on the PSP under ITEM 5, COVERAGES AND LIMITS, COVERAGE B - Liability to Others. The maximum defense costs payable under this policy are limited, however, to a dollar amount that is "equal" to the Liability Limits listed on the PSP under Item 5, COVERAGES AND LIMITS, COVERAGE B - Liability to Others. We will pay: 1. all our expenses and all costs awarded against you or anyone we protect in any suit we are required to defend, including: a. any prejudgment interest awarded but, only on that part of the judgment we are required to pay under this policy; b. all interest on the judgment we are required to pay under this policy which accrues after the entry of the judgment but before we are paid, offered to pay, tendered or deposited in court the part that is within the limit of our liability; 2. premiums on bonds required to release attachments or appeal judgments we elect to appeal. We will not pay for bonds covering a total amount more than our limit of liability; 3. the cost of bail bonds, up to $1,000. each, required of you for a violation of a law for civil aviation arising out of the use of your aircraft. We will not furnish or apply for any bail bonds; 4. expenses you incur for first aid relief that is needed at the time and site of an occurrence; 5. all expenses you incur at our request. But, we will not pay for you or your employees' loss of earnings, wages, or salaries. We are not obligated to pay any expense, claim or judgment or to defend any suit after our Limits of Coverage has been used up by our payment of judgments, or settlements. In such case, we shall have the right to withdraw from the further investigation, defense, or settlement of the claim by tendering control of such investigation, defense, or settlement of the claim to you or any person insured under this policy. NOTHING HEREIN CONTAINED SHALL BE HELD TO VARY, WAIVE, ALTER OR EXTEND ANY OF THE TERMS, CONDITIONS OR AGREEMENTS OF THE POLICY OTHER THAN STATED ABOVE. Policy Issued to: Endorsement No. Policy No. Date and hour endorsement takes effect Approved: Specialty Aviation Underwriters, LLC By: SAU Page 1

5 Specialty Aviation Underwriters, LLC Endorsement DELETION OF "FAMILY MEMBER" LIMITATION OF LIABILITY SUBLIMITS In consideration of an additional premium of Included, PART THREE COVERAGE "B" - LIABILITY TO OTHERS, Paragraph 7 - "Family Member - Limits of Liability" is deleted from this Policy in its entirety. NOTHING HEREIN CONTAINED SHALL BE HELD TO VARY, WAIVE, ALTER OR EXTEND ANY OF THE TERMS, CONDITIONS OR AGREEMENTS OF THE POLICY OTHER THAN STATED ABOVE. Policy Issued to: Endorsement No. Policy No. Date and hour endorsement takes effect Approved: Specialty Aviation Underwriters, LLC By: SAU Page 1

6 Specialty Aviation Underwriters, LLC Endorsement PASSENGER LIABILITY LIMIT RESTRICTION FOR COVERAGE 2.a., COMBINED SINGLE LIMIT LIABILITY FOR BODILY INJURY AND PROPERTY DAMAGE Read this form carefully. It changes your LIMITS OF LIABILITY and coverage to put a passenger liability limit per seat as reflected below. Your aircraft coverage for aircraft liability shown in PART THREE of your policy, COVERAGE B LIABILITY TO OTHERS, is changed to read: 2.a. "COMBINED SINGLE LIMIT LIABILITY COVERAGE FOR BODILY INJURY (INCLUDING LIMITED COVERAGE FOR PASSENGERS) AND PROPERTY DAMAGE". We will pay for bodily injury and property damage, but the most we will pay for bodily injury to any person, who is a passenger, is limited to the amount stated for "Passenger Bodily Injury" for "Each Person", as set forth below. The most we will pay for all bodily injury, including passengers, and property damage, arising out of each occurrence involving one or more aircraft, is the amount stated for "Each Occurrence", as set forth below, no matter how many people or organizations are involved. Your aircraft liability limit and coverage shown in Item 5 of your PSP, COVERAGES AND LIMITS Coverage B Liability To Others, is changed to read: TYPE OF COVERAGE AND LIMITS OF LIABILITY Combined Single Limit Bodily Injury & Property Damage Passenger (Including Passengers) Bodily Injury FAA Number $1,000,000 $100,000 All Aircraft not listed below. Each Occurrence Each Person NOTHING HEREIN CONTAINED SHALL BE HELD TO VARY, WAIVE, ALTER OR EXTEND ANY OF THE TERMS, CONDITIONS OR AGREEMENTS OF THE POLICY OTHER THAN STATED ABOVE. Policy Issued to: Endorsement No. Policy No. Date and hour endorsement takes effect Approved: Specialty Aviation Underwriters, LLC By: SAU Page 1

7 PART ONE GENERAL PROVISIONS AND CONDITIONS Before you read the other PARTS of your policy, here are some things you need to know about your coverage. 1. Words and Phrases When they appear in boldface print, these terms have specific meaning in this policy. PSP means your Policy Summary Page which is a part of this policy. You or Your means any person or entity shown in Item 1 of your PSP. Our, Us or We means the insurance company shown on your PSP. Agreed Value is the amount shown under "Aircraft Physical Damage" in Item 5 of the PSP. It is how much you and we agree your aircraft is worth. Aircraft means the aircraft shown in Item 4 of the PSP or aircraft covered under PART SIX of this policy. Included are parts and equipment permanently installed in or on the aircraft and as reflected in the aircraft weight and balance records. Parts temporarily removed are included if not replaced by other parts. Anyone means any person or entity except you. Aviation Managers means Specialty Aviation Underwriters, Inc., which manages our aviation insurance business for us. Bodily Injury means physical injury to a person, including sickness, disease, or death, and resulting mental anguish, if any. Crew or Crew Member means any person who is required for or assists in in-flight operations of the aircraft. Direct Operating Costs means the actual costs for a specific flight for: a. fuel and oil; b. crew costs such as food or lodging but not salary or wages; c. hangar or tie-down costs away from the aircraft's home base; d. weather and flight plan services; e. insurance specifically purchased for that flight; f. landing fees; g. customs, foreign permits, and like fees; h. in-flight food and drinks; i. an additional amount that does not exceed 100% of your cost for item a. above "fuel and oil". Environmental Disturbance means: a. any noise or vibration (whether or not audible), which includes sonic boom and the like; b. interference with the use of property; c. electrical or electromagnetic interference of any type; d. pollutants, contaminants or waste of any type. "Pollutants" or "contaminants" include, but are not limited to, any solid, liquid, gaseous or thermal irritant or contaminant, such as smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed. Excess Insurance means insurance that only applies when all other available insurance has been exhausted by the payment of claims, except insurance specifically purchased by you to apply as excess over this policy. If such other insurance is written by us, the total limit of our liability is the highest limit of any one policy. FAA means the Federal Aviation Administration or its equal in another country. In-flight is from the start of a fixed wing aircraft's takeoff run until it has completed its landing roll. For rotorcraft, it is any time the rotors are moving under power for lift off. For any other aircraft, it is any time it is off a supporting surface. Ingestion means physical damage to turbine engines or power units caused by objects which are not or were not part of the engine or its accessories. It must be the result of one event that requires, or would require if known, its repair before further use. In Motion is when an aircraft is in-flight or moving under its own power or the resulting momentum. For rotorcraft, it is anytime it is in-flight or when its rotors are moving under power or the resulting momentum. Medical Expenses are medical, surgical, x-ray and dental costs, as well as prosthetics, necessary ambulance, professional nursing or funeral service costs. Nonowned Aircraft means any aircraft except one: a. owned in whole or in part by, or registered to, you; b. shown in Item 4 of your PSP; c. leased to you for more than 30 days. Page 1 of 12

8 Occurrence means an accident, including continuous or repeated exposure to conditions, during the policy period, not expected or intended, which results in physical damage, bodily injury or property damage. All injury or damage from the same general causes and conditions will be viewed as caused by one occurrence. Partial Loss means any loss which is not a total loss. Passenger means a person in, getting in or out of your aircraft for a ride or flight, including crew or a crew member. Physical Damage means sudden and accidental direct loss of or damage to property during the policy period. It does not include any loss of use, consequential loss, or any loss in value before or after repairs. Pilot In Command is the crew member who is in charge of in-flight operations. Premises are the areas of an airport used in connection with your aircraft. Property Damage means accidental damage to the tangible property of others and its loss of use that may result. Renter Pilot is any person or entity who has paid, or agreed to pay, more than the direct operating costs for the use of the aircraft. Salvage Value is the value of damaged property prior to repair. Student Pilot means a person who does not have a pilot license while taking instruction in an aircraft or any pilot holding an FAA Student Pilot Certificate. Substitute Aircraft is a nonowned aircraft that you use because an aircraft in Item 4 of the PSP is damaged or being repaired or serviced. Total Loss is when the cost to repair, when added to the salvage value, exceeds the aircraft's agreed value. 2. Our Obligations and Your Duties We will provide the coverages you have bought if you pay the premium and comply with all of the policy terms. If you do not, then we are not obligated under any part of this policy. 3. When and Where You are Covered You are only covered for occurrences during the policy period while the aircraft is in, or enroute between, the United States (excluding Alaska and Hawaii), Canada, Mexico or the Bahama Islands. 4. What Your Policy Does Not Cover a. Pilot When the aircraft is in-flight, you must make certain that the pilots are "approved pilots" in Item 7 of the PSP. There is no coverage if this requirement is not met. If the aircraft is being flown for a maintenance or test flight by an FAA licensed repair station's pilot, Item 7 of the PSP does not apply. b. Use You must make certain that each aircraft is operated only for the "approved use" shown in the PSP. If the aircraft is used for any other purpose with your knowledge and consent, there is no coverage under this policy. c. Concealment or Misrepresentation This policy is void if any material fact is intentionally concealed or misrepresented. d. Waivers There is no coverage if the aircraft is in-flight under conditions requiring any special FAA permit or waiver, even if a permit or waiver has been granted by the FAA. e. Airworthiness There is no coverage if the aircraft is operated inflight, unless it is operated under a Standard category airworthiness certificate issued by the FAA, that is current and effective at the beginning of its flight. f. Unlawful Purpose There is no coverage if the aircraft is used for any unlawful purpose with your knowledge and consent. g. Ownership This policy is void if you lease, sell or mortgage any of your interest in your aircraft unless that interest is shown in this policy. h. Radiation We do not cover any claim or suit arising out of ionizing radiation or radioactivity. i. Assumed Liability We do not cover liability assumed in any agreement except with a governmental authority for your use of an airport. This does not apply to liability you would incur without the agreement. j. Intentional Acts We do not cover any loss or damage intentionally caused by you. k. Environmental Disturbance We do not cover any loss caused by environmental disturbance, or any cost to test for, monitor, clean up, remove, contain, treat or detoxify pollutants, contaminants or waste of any kind. This does not apply to an aircraft crash or an in-flight emergency. l. War Risks and Other Perils We do not cover claims or suits caused by: Page 2 of 12

9 (1) war, invasion, acts of foreign enemies, hostilities (whether war be declared or not), civil war, rebellion, revolution, insurrection, martial law, military or usurped power or attempts at usurpation of power; (2) any hostile detonation of any weapon of war employing atomic or nuclear fission and/or fusion or other like reaction or radioactive force or matter; (3) strikes, riots, civil commotions or labor disturbances; (4) any act of one or more persons, whether or not agents of a sovereign power, for political or terrorist purposes and whether the resulting loss or damage is accidental or intentional; (5) any malicious act or act of sabotage; (6) confiscation, nationalization, seizure, restraint, detention, appropriation, requisition for title or use by or under the order of any government (whether civil, military or de facto) or public or local authority; (7) hi-jacking or any unlawful seizure or wrongful exercise of control of the aircraft or any of its crew members in-flight (including any attempt at such seizure or control) made by any person or persons on board the aircraft acting without your consent. Furthermore, this policy does not cover claims or suits arising while the aircraft is outside your control by reason of any of the above perils. The aircraft shall be deemed to have been restored to your control on the safe return of the aircraft to you at an airfield not excluded by the geographical limits of this policy, and entirely suitable for the operation of the aircraft (such safe return shall require that the aircraft be parked with engines shut down and under no duress). 5. If You Have an Accident In the event of an occurrence, you must: a. notify us right away and tell us when, where and what happened and, if known, the names of witnesses, anyone who is injured, and all passengers; b. cooperate with us in the investigation, settlement or defense of any claim or suit; c. answer, under oath if we request, questions we ask; d. send us any notices or legal papers you get right away; e. help us in obtaining and giving evidence, attending trials, and getting witnesses to testify; f. notify the police right away if any covered property is stolen or vandalized; g. not make any statement without our permission except to a governmental authority; h. not assume any obligation or incur any expense without our permission, except for first aid to others and reasonable costs for protection of the covered property from further loss. 6. Changing This Policy If you wish to change your policy, ask your agent to contact our aviation managers. No change occurs until your agent is advised in writing by our aviation managers that we agree to it. 7. Canceling This Policy You may cancel this policy at any time by writing us or our aviation managers before the date you want your coverage to end. If you cancel the policy, the premium refund may be less than pro rata. We or our aviation managers can cancel this policy at any time by mailing or delivering a notice to the first named insured and address shown in Item 1 of the PSP at least 30 days before the date the coverage will end. If we cancel for a premium not being paid, we can do so with 10 days notice. Our proof of mailing or delivering the notice is sufficient proof of notice to you. If we cancel the policy, the refund will be pro rata. We will return to you any premium you have paid that we have not earned, but making the refund is not a condition for the cancellation to be effective. 8. Other Coverage If there is other insurance for an occurrence that is also covered by this policy, we will pay only the ratio that the limit of this policy bears to the total of the limits of all policies. If the other insurance is issued by us, we will not pay more than the limits of the policy having the highest limits. The coverages in PART SIX of this policy are excess insurance. 9.Transfer of Interest in Your Policy No one can transfer an interest in this policy without our consent. If you die or are judged bankrupt, your legal representative will have all of your rights and duties under this policy while settling your affairs. Your death or bankruptcy will not relieve us under this policy if we or our aviation managers are notified within 60 days. 10. Our Right of Recovery If we pay any claim, we will take over your right to recover from anyone who is responsible for the loss. You must not do anything that will interfere with our rights and efforts to recover. Page 3 of 12

10 11. State Insurance Laws If any terms of this policy conflict with state insurance laws, we will comply with those laws. 12. Legal Action Against Us No action can be brought against us until all of the policy provisions have been met and our duty has been established. No one can join us as a party to any action against you or anyone we protect. No one can bring us into any action to determine the liability of you or anyone we protect. 13. Inspection and Audit We have the right but not the duty to inspect any covered property and records during and up to one year after the end of your policy period or at anytime during a related claim settlement. 14. Military Certificates If we issue a certificate to the U.S. military for the use of an airport, the minimum insurance requirements are automatically made a part of this policy. 15. Multiple Named Insureds There may be more than one person or entity shown in Item 1 of your PSP. If so, all physical damage losses will be adjusted only with the first person or entity shown in Item 1 and made payable to all those shown. Page 4 of 12

11 PART TWO COVERAGE A AIRCRAFT PHYSICAL DAMAGE This coverage is for you only and not for the benefit of anyone else unless otherwise stated in this policy. Look at Item 5 of your PSP to confirm the exact type of aircraft physical damage coverage you have purchased for each aircraft. Note the agreed value of your aircraft and your deductible. If you did not buy COVERAGE A AIRCRAFT PHYSICAL DAMAGE, there is no agreed value in Item 5 of your PSP and PART TWO does not apply. 1. What We Cover We will pay for physical damage to your aircraft caused by an occurrence during the policy period. Physical damage will only apply for the type of coverage you bought. a. In Motion If the "Type of Coverage" states Ground and Flight in Item 5 of your PSP, we will pay for aii physical damage to that aircraft. b. Not In Motion If the "Type of Coverage" states Not In Motion in Item 5 of your PSP, we will only pay for physical damage that occurs while that aircraft is not in motion. We will not pay for fire, explosion or other physical damage resulting from an in motion occurrence. 2. What You Must Pay (Deductible) If we pay for physical damage to your aircraft, you must first pay one of the following: a. Aircraft Not in Motion Deductible You must first pay your ''not in motion" deductible if we pay for physical damage that occurs while your aircraft is not in motion. If your aircraft is regularly hangared at its home base, we will not deduct this amount for physical damage that occurs while it is in the hangar. b. Aircraft In Motion or Ingestion Deductible You must first pay your in motion" or "ingestion" deductible if we pay for physical damage that occurs while your aircraft is in motion, or for any loss caused by ingestion. c. No Aircraft Deductible No deductible applies if we pay for aircraft physical damage caused by: (1) fire, lightning, explosion, theft or vandalism; (2) an occurrence involving someone else's aircraft insured by us; (3) an occurrence while your aircraft is dismantled and is being transported. 3. What We Will Pay a. Emergency Landing If an emergency landing is made off an airport and there is no damage to your aircraft, we will pay the reasonable cost to move your aircraft to the nearest suitable airport. You must notify us and we must arrange for the transportation. b. Total Loss If your aircraft is a total loss, we will pay the agreed value of the aircraft, less the applicable deductible. We have the right to take the aircraft, but you cannot abandon it to us. We will also return any physical damage premium to you that we did not earn. We will base what we earned on the policy period that has elapsed at the time of the loss. If you request, instead of paying the agreed value, we will pay you the difference between the aircraft's agreed value and its salvage value, less any deductible. You can keep the salvage. c. Partial Loss If your aircraft is a partial loss, the following applies: (1) If you make repairs, we will reimburse you for the following less any deductible that applies: (a) your net costs for materials and parts of similar kind and quality needed for the repair; (b) wages paid at the straight-time rate at the place of repair plus 100% of this amount to cover your cost of overhead; (c) transportation costs. (2) If anyone else makes repairs, we will pay the following less any deductible that applies: (a) your net costs for the repair with parts of similar kind and quality, excluding any charges for overtime; (b) "transportation costs". (3) We will not pay more than the agreed value of the aircraft. Page 5 of 12

12 "Transportation costs" means the cost of transporting by the least expensive reasonable means: - parts from the site of the loss to the most practical place where they can be repaired; - replacement parts from a place nearest the site of the loss; - the aircraft to the most practical place where it can be repaired and then back to the site of the loss or your home airport, whichever is closer. 4. What We Will Not Pay We will not pay for physical damage: a. directly caused by wear and tear, deterioration, freezing, mechanical or electrical breakdown or failure. However, if there is additional physical damage that results from any of these causes, we will pay for the additional physical damage; b. to an engine due to any type of mechanical breakdown or failure of the engine or its parts unless caused by ingestion; c. to an engine that arises out of heat or the improper operation of a turbine engine; d. to tires, unless caused by theft, vandalism, or the result of other physical damage we cover; e. to your aircraft if it is equipped for water operation unless it is stated as "sea" or "amphibian" in Item 4 of the PSP; f. to your aircraft caused when someone with a legal right to possess the aircraft embezzles, converts or secretes it under a lease, rental agreement, conditional sale, mortgage or other legal right governing the use, sale or lease of property. 5. What You Must Do If your aircraft is damaged, you must: a. do all you can to protect it from further loss. If you do not, we will not pay for further loss. We will reimburse you for all reasonable expenses you incur in protecting it; b. show us the physical damage before its repair or disposition; c. show us the records you have that prove the amount of loss; d. give us a sworn Proof of Loss statement within 90 days of the loss; e. give us free and clear title to any salvage if we pay a total loss. statement and you and we agree on the amount to be paid. 7. Appraisal of Damage If you and we do not agree on the amount of physical damage, the following arbitration procedure will be used to settle the dispute: a. You can request in writing that the dispute be arbitrated. We can do the same; b. Each will then select an appraiser and will inform the other of their choice within 20 days; c. The appraisers will select an impartial umpire. If they cannot agree on an umpire within 15 days, a judge of the state in which the property is located can appoint one if asked to do so by you or us; d. Each appraiser will appraise the loss. If they do not agree, they will submit their differences to the umpire. Agreement by any two of the three will decide the amount of the loss. You will then pay your appraiser and we will pay ours. Any other costs of the appraisal and the umpire will be divided equally. 8. Automatic Increase In Value You may add equipment to or modify your aircraft after the effective date of this policy, but you must advise us within 30 days of the addition or modification for it to be covered by this policy. Unless we agree otherwise, the agreed value will increase by 10% or the amount you paid for the addition or modification, whichever is less. You agree to pay any additional premium. 9.Theft If your aircraft is stolen and recovered before we pay for it, we may return it to you and pay for any physical damage. 10.Disappearance We will consider your aircraft to be lost in-flight if it is not located within 60 days. 11.Reinstatement of Coverage If your aircraft is damaged, the agreed value will be reduced by the amount of the damage. The agreed value will increase by the cost of repairs until it has been restored. 6. When We Will Pay We will pay for physical damage within 30 days after you have given us our required Proof of Loss Page 6 of 12

13 PART THREE COVERAGE B - LIABILITY TO OTHERS Look at Item 5 of your PSP to confirm the coverage and liability limits you have purchased. If you did not buy COVERAGE B - LIABILITY TO OTHERS, there are no liability limits shown in Item 5 of your PSP and PART THREE does not apply. 1. What We Cover We cover damages you and anyone we protect are legally required to pay for bodily injury or property damage arising out of the ownership, maintenance or use of your aircraft if caused by an occurrence during the policy period. 2. Your Coverage And The Most We Will Pay The Type of Coverage you purchased is shown in Item 5 of your PSP under Coverage B Liability To Others, and is described below: a. COMBINED SINGLE LIMIT LIABILITY COVERAGE FOR BODILY INJURY AND PROPERTY DAMAGE. If you purchased this Type of Coverage, we will pay for bodily injury and property damage, but the most we will pay for all such bodily injury and property damage, arising out of each occurrence involving one or more aircraft, is the amount stated for each occurrence in Item 5 of your PSP for this Type of Coverage, no matter how many people or organizations are involved. b. COMBINED SINGLE LIMIT LIABILITY COVERAGE FOR BODILY INJURY (INCLUDING LIMITED COVERAGE FOR PERSONS) AND PROPERTY DAMAGE. If you purchased this Type of Coverage, we will pay for bodily injury and property damage, but the most we will pay for bodily injury to any person is limited to the amount stated for each person in Item 5 of your PSP for this Type of Coverage. The most we will pay for all bodily injury and property damage, arising out of each occurrence involving one or more aircraft, is the amount stated for each occurrence in Item 5 of your PSP for this Type of Coverage, no matter how many people or organizations are involved. c. COMBINED SINGLE LIMIT LIABILITY COVERAGE FOR BODILY INJURY (INCLUDING LIMITED COVERAGE FOR PERSONS BUT EXCLUDING COVERAGE FOR PASSENGERS) AND PROPERTY DAMAGE. If you purchased this Type of Coverage, we will pay for bodily injury and property damage, but we will not pay for bodily injury to a passenger and the most we will pay for bodily injury to any person who is not a passenger is limited to the amount stated for each person in Item 5 of your PSP for this Type of Coverage. The most we will pay for all bodily injury and property damage, arising out of each occurrence involving one or more aircraft, is the amount stated for each occurrence in Item 5 of your PSP for this Type of Coverage, no matter how many people or organizations are involved. More Than One Aircraft If there is more than one aircraft involved in one occurrence, we will not pay more for all bodily injury and property damage, arising out of that occurrence, than the highest occurrence limit stated in Item 5 of your PSP applicable to any one of the aircraft involved in that same occurrence. 3. Who We Protect Besides you, certain others are also protected if the aircraft is being used within the scope of your permission. These others are: a. your employees, directors, and stockholders, if acting in the scope of their duties as such; b. any passenger; c. any entity that is responsible for the use of your aircraft. Each person, entity or aircraft is covered separately. But, regardless of how many are protected and how many aircraft are involved in one occurrence, we will not pay more for that occurrence than the highest occurrence limit stated in Item 5 of your PSP applicable to any one of the aircraft involved in that same occurrence. 4. Who We Do Not Protect We do not protect any of the following even if they meet the conditions of Paragraph 3. above: a. any person, organization or their agents or employees involved in any of the following activities: (1) the manufacture or sale of aircraft, aircraft parts, engines, avionics, or accessories; Page 7 of 12

14 (2) the repair, service or flight testing of aircraft, aircraft parts, engines, avionics, or accessories; (3) the operation or performance of any commercial piloting services. As used in this paragraph, "commercial piloting services" means the following services for which a charge is made or remuneration is expected or intended: (a) any pilot or crew instruction, training, or proficiency check services; (b) any pilot or crew services; (c) the operation of any flying school, flying club, flying service, airport or aircraft hangar, parking or tie-down facility; if an occurrence arises out of any of these. However, you and your employees are covered for these activities if they are in connection with your aircraft and no charge is made to others unless specifically allowed by this policy; b. you or any person who, while working in the scope of their employment, injures someone who works for the same employer; c. any renter pilot. c. property damage to your aircraft or any property that you or anyone we protect owns, rents, leases, occupies, has charge of, transports, or is otherwise in the care, custody and control of you or anyone we protect; d. bodily injury or property damage arising out of the use of any premises. 6. Financial Responsibility Laws If this policy is used as proof of insurance under any financial responsibility law, we will pay up to the limits of liability required by such law. But, we will not pay more than the limit of liability that applies under this policy. You agree to pay us back for any amount we have paid that we would not have otherwise had to pay under this policy. 7. Family Member Limits of Liability The most we will pay for bodily injury for which you or any person insured under this policy are liable to a Family Member is $25,000. Family Member means a parent (whether natural, step, or adoptive), spouse, or child (whether natural, step, or adopted) of you or any person insured under this policy. 5. What We Also Do Not Cover In addition to what we do not cover as stated in other parts of your policy, we also do not cover: a. bodily injury to an employee of yours, or to an employee of anyone we protect, arising out of and in the course of their employment by the person or organization we protect; b. any obligation which is covered under any workers' compensation, unemployment compensation, disability benefits, or similar law; Page 8 of 12

15 PART FOUR DEFENSE, SETTLEMENT AND OTHER PAYMENTS If you bought coverage under PART THREE, we have the right and duty to defend any suit against you or anyone we protect for bodily injury or property damage that is covered by this policy. This applies even if the suit is groundless, false or fraudulent. We may investigate, negotiate or settle any claim or suit as we deem necessary. Any payment under this section is included as part of the Limits of Coverage, and not in addition to the Limits of Coverage as stated in the Each Occurrence Limits of Coverage listed on your PSP under Item 5, COVERAGES AND LIMITS, Coverage B - Liability to Others. We will pay, subject to the Limit of Coverage for Each Occurrence : 1. all our expenses and all costs awarded against you or anyone we protect in any suit we are required to defend, including: a. any prejudgment interest awarded but, only on that part of the judgment we are required to pay under this policy; b. all interest on the judgment we are required to pay under this policy which accrues after the entry of the judgment but before we have paid, offered to pay, tendered or deposited in court the part that is within the limit of our liability; 2. premiums on bonds required to release attachments or appeal judgments we elect to appeal. We will not pay for bonds covering a total amount more than our limit of liability; 3. the cost of bail bonds, up to $1,000 each, required of you for a violation of a law for civil aviation arising out of the use of your aircraft. We will not furnish or apply for any bail bonds; 4. expenses you incur for first aid relief that is needed at the time and site of an occurrence; 5. all expenses you incur at our request. But, we will not pay for you or your employees' loss of earnings, wages or salaries. We are not obligated to pay any expense, claim or judgment or to defend any suit after our Limits of Coverage has been used up by our payment of judgments, settlements, or payments of costs or expenses under this section. In such case, we shall have the right to withdraw from the further investigation, defense, or settlement of the claim by tendering control of such investigation, defense, or settlement of the claim to you or any person insured under this policy. Page 9 of 12

16 PART FIVE COVERAGE C - PASSENGER MEDICAL EXPENSE Look at Item 5 of your PSP to confirm the exact passenger medical expense limits you have purchased. If you did not buy COVERAGE C - PASSENGER MEDICAL EXPENSE, there are no limits shown in Item 5 of your PSP and PART FIVE does not apply. 1. What We Will Pay Regardless of liability, we will pay all reasonable medical expenses incurred within one year from the date of injury, to or for each covered passenger who sustains bodily injury covered by this policy. The most we will pay for each passenger's medical expenses is the amount stated for "each passenger" under "Passenger Medical Expense Limits" in Item 5 of your PSP. The most we will pay for all medical expenses in any one occurrence is the amount stated for "each occurrence" under "Passenger Medical Expense Limits" in Item 5 of your PSP. 2. Whom We Will Pay We will pay each injured passenger, the person who paid the expense, or the entity providing the service. 3. What We Will Not Pay We will not pay any expense that is covered under any workers' compensation or disability benefits or similar law. Nor will we pay any medical expenses if the aircraft was not being used within the scope of your permission. 4. Effect of Payment By making any payment, we are not admitting that you or anyone we protect has any legal liability. 5. Proof of Claim The injured passenger or someone acting for them must give us written proof of the medical expenses and must give us any records and reports we may reasonably need. If we ask, the injured passenger must submit to examination by a doctor we select. 6. When We Will Pay We will pay for medical expenses within 30 days of our receipt of the required proofs of claim. Page 10 of 12

17 PART SIX OTHER AIRCRAFT Coverage in PART SIX is excess insurance and does not apply to any claim or loss covered by other parts of this policy. We must insure all aircraft you own or exclusively lease or these coverages do not apply. 1.What We Cover a. Use of Substitute Aircraft If you use a substitute aircraft, we will provide you with the same coverage for PART THREE and PART FIVE you bought for the aircraft that is not available. b. Use of Other Aircraft If you are one individual, or one individual and spouse, the same coverage you bought for PART THREE and PART FIVE will protect you and your spouse while you or your spouse are lawfully using a nonowned aircraft, other than a substitute aircraft. c. Newly Acquired Aircraft If you become the owner or exclusive lessee of another aircraft during the policy period, we will cover it if you notify us within 30 days and pay an additional premium. Unless we agree otherwise, we will provide you with the following: (1) If it replaces an aircraft shown in Item 4 of the PSP, the same coverage as we provided on the replaced aircraft for PART THREE and PART FIVE and the same type of physical damage coverage and deductibles we provided on the replaced aircraft. But, we will not pay more than the following, less the applicable deductible: (a) the amount you paid for the aircraft plus your costs for any repairs or additions; or (b) in the case of a trade-in, the fair market value of the aircraft, or (c) if leased, the amount the lease requires you to insure the aircraft for, or (d) the agreed value of the aircraft being replaced; whichever is less. (2) If it is an additional aircraft, the same coverages we provide in PART THREE and PART FIVE for the aircraft with the closest seating capacity and the same type of physical damage coverage and deductibles we provide on the most similar aircraft. But, we will not pay more than the following, less the applicable deductible: (a) the amount you paid for the new aircraft plus your costs for any repairs or additions; or (b) in the case of a trade-in, the fair market value of the aircraft; or (c) if leased, the amount the lease requires you to insure the aircraft for; or (d) the agreed value of the most similar aircraft shown in Item 4 of your PSP, whichever is less. We will not pay more than the limits of liability shown under "Liability To Others" or "Passenger Medical Expense" shown in Item 5 of your PSP. 2. What We Also Do Not Cover In addition to what we do not cover as stated in other parts of your policy, we also will not cover a substitute aircraft, nonowned aircraft, or newly acquired aircraft, or its use: a. unless the "Approved Pilots" and "Approved Uses" parts of the PSP are met; b. unless it is operated in-flight under a "Standard" category airworthiness certificate issued by the FAA, that is current and effective at the beginning of its flight; c. if it is a multiengine aircraft unless an aircraft in Item 4 of the PSP is also a multiengine aircraft; d. if it is a turbine powered aircraft unless an aircraft in Item 4 of the PSP is also a turbine powered aircraft; e. if it is a rotorcraft unless an aircraft in Item 4 of the PSP is also a rotorcraft; f. if it is a seaplane or amphibian unless an aircraft in Item 4 of the PSP is also a seaplane or amphibian; g. if it is a lighter-than-air aircraft unless an aircraft in Item 4 of the PSP is also a lighter-than-air aircraft; h. for any loss arising out of the use of any product you manufacture, sell, handle, service or distribute. We will also not provide any coverage for or on behalf of any owner or lessor, or their agents or employees, of any substitute aircraft or nonowned aircraft. Page 11 of 12

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