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Life Insurance for Pilots and Aviation Enthusiasts in Canada

Life Insurance for Pilots in Canada
Life Insurance for Pilots in Canada

For pilots in Canada, obtaining life insurance that fits your aviation lifestyle is crucial. The right policy provides a financial safety net for your loved ones should the unthinkable happen while flying. However, the application process is complex and requires working with experts who understand the intricacies of aviation underwriting.

This guide examines how life insurance works for pilots, from policy types to cost considerations to tips for securing optimal coverage. Read on for insights tailored to the Canadian insurance market.

Defining Life Insurance for Pilots

Life insurance pays out a death benefit to named beneficiaries if the policyholder passes away. For pilots, it serves the vital purpose of replacing income and providing financial stability to family members in the event of an aviation-related accident.

According to the Government of Canada 2018, there were 22,132 private pilot licences for aeroplanes, 7,470 commercial pilot licences for aeroplanes, and 13,595 airline transport pilot licences for aeroplanes. (source: https://tc.canada.ca/en/aviation/licensing-pilots-personnel/aviation-personnel-licensing-statistics). There are nearly 2,000 registered aerodromes in Canada – about 300 of these are certified (airports). The number of aerodromes increases to about 6,000 when one takes into account non-registered aerodromes such as private airstrips. (source: https://www150.statcan.gc.ca/n1/pub/11-621-m/11-621-m2021002-eng.htm).

Policies designed for pilots take into account the heightened risks of flying and deliver benefits, specifically covering death while operating an aircraft. Most insurers require detailed information on licensing, experience levels, and types of aircraft flown for underwriting. Coverage amounts also tend to be higher due to income replacement needs. Pilot life insurance is fundamentally structured to acknowledge aviation hazards.

The Two Main Types of Life Insurance for Pilots in Canada

Types of Life Insurance for Pilots
Types of Life Insurance for Pilots

Canadian pilots have access to two primary types of life insurance policies: term life insurance and permanent life insurance.

Term Life Insurance for Pilots

Term life insurance for pilots provides pure death benefit protection for a set period of time. There’re usually Term 10, Term 20 or Term 30 . It pays out a lump sum if you pass away at any point during the term. If you survive to the end, the coverage expires without payment.

Benefits include:

  • Lower premiums than permanent insurance
  • Ability to secure very high death benefits
  • Options to renew coverage or convert to permanent insurance later on
  • Can add ‘living benefits’ riders for costs like disability

For pilots, term life insurance is a popular pick due to its affordability and capacity to deliver large death payouts. Coverage amounts exceeding $5 million are possible depending on age and health. The temporary coverage period also aligns with higher risk phases of aviation careers.

More on this topic: What is Term Life Insurance

Permanent Life Insurance for Pilots

Permanent life insurance maintains coverage throughout your entire lifetime. The main options are whole life and universal life.

Whole life policies have guaranteed death benefits, guaranteed premiums, and a cash value savings component that grows over time.

Universal life insurance allows pilots to adjust their death benefit amounts and offers flexible premium payments. It similarly builds up a cash value fund that earns tax-deferred interest.

Due to the savings element, permanent policies carry higher premium costs than term life insurance. However, they provide lifelong protection that persists beyond any set term. This appeals to some pilots planning long careers in aviation.

More on this topic: What is permanent life insurance

How Aviation Activities Are Assessed in Life Insurance for Pilots

Insurers categorize aviation into three classifications when evaluating risks:

Commercial Aviation

  • Airline pilots, air cargo, charters
  • Meet strict training standards
  • Lower risk group

Private Aviation

  • Personal travel or recreation
  • Private pilots
  • More scrutiny than commercial

Sport Aviation

  • Aerial competition, ultralights
  • Highest risk category
  • Coverage challenges likely

The category a pilot falls into determines eligibility for coverage as well as policy pricing. Insurers perceive commercial aviation to be the safest, while sport fliers tend to face the most difficulty securing affordable premiums.

Private pilots land somewhere in the middle – they can obtain policies but generally at elevated rates compared to commercial aviators. Categorization is based on factors like licenses held, flight experience, and types of aircraft flown.

Key Factors That Influence The Costs of Life Insurance for Pilots

Key Factors That Influence The Costs of Life Insurance for Pilots
life buzz quote in canada new 8 1
Key Factors That Influence The Costs of Life Insurance for Pilots

In addition to the aviation category, several other variables shape costs and underwriting eligibility.

Experience and Qualifications

A pilot’s overall flight experience and qualifications help determine the risk level and pricing of their aviation life insurance policy. Key aspects considered by underwriters include:

  • Total flight hours logged per year
  • Any specialized flight training or accreditations held
  • Years of experience as a licensed pilot
  • Type of aircraft regularly flown

More flight hours logged annually and greater overall experience as a career pilot generally result in more favourable policy rates. However, underwriters look at these criteria on an individual basis when evaluating applicants.

Aircraft Types Flown

  • Commercial jets vs. private prop planes
    • Airlines safest option
  • Jets vs. propeller planes
    • Jets score lower risk
  • Experimental aircraft
    • Considered high risk

Larger commercial jets receive better rates than smaller private prop planes or experimental aircraft.

Specialized Aviation Activities

  • Acrobatics, racing, stunts
    • Risky behaviours raise premiums
  • Mountainous or remote areas
    • Costs more to cover
  • Flight instruction
    • Instructing riskier

Partaking in high-risk maneuvers or flight environments drives rates up.

Age and Health

  • Age when applying
    • Youth preferred
  • Medical history
    • Issues increase costs
  • Current health
    • Poor health raises rates

Younger, healthy pilots pay less than older pilots or those with life insurance for pre-existing conditions.

Let’s take a look at sample underwriting guidelines from Equitable Life of Canada :

For commercial pilots, the main factors determining life insurance eligibility and rates are the type of specialized flying they engage in and their overall experience measured in total flight hours per year. Commercial pilots participating in activities like passenger and freight airline flights generally receive standard rate offers of up to $10 extra per $1,000 of coverage. 

For private, non-professional pilots, underwriting decisions depend heavily on age and flight experience. Pilots under age 26 or with less than 100 hours logged will likely get an extra rating of $3.50 per $1,000 for five years. However, private pilots over age 26 with more than 100 hours of experience and plans to fly less than 200 hours in the next 12 months may qualify for standard rates. (source: https://cdn.equitable.ca/forms/unsecured/insurance/1024.pdf).

Securing the Optimal Pilot Life Insurance Policy

Given aviation complexities, working with a broker specializing in pilot insurance is strongly advised. These experts assist with the following:

  • Comparing policies from a wide range of insurers
  • Optimizing plans based on specific aircraft and flight details
  • Securing the best rate class, you qualify for
  • Appealing any unfavourable underwriting decisions

When applying, disclosing precise flying details prevents denials or re-underwriting later. Completing insurer questionnaires comprehensively and accurately is critical. An experienced broker advocates on your behalf to navigate this process.

Weighing the Pros and Cons of Life Insurance for Pilots

Potential Advantages

  • Vital income replacement and loss protection for family
  • Covers costs directly associated with death while flying
  • Capacity to secure high death benefit amounts
  • Available regardless of licensing or flight category

Potential Disadvantages

  • Premium costs run 10-15% higher than non-pilots on average
  • Complex underwriting procedures are required
  • Aviation exclusions or riders are often mandatory
  • Higher likelihood of coverage delays or denials

Securing proper coverage provides peace of mind and financial stability. However, pilots must weigh higher policy expenses resulting from perceived aviation risks.

Typical Premium Cost Ranges of Life Insurance for Pilots in Canada

Life insurance rates for pilots vary substantially depending on individual circumstances. Below are some sample monthly premiums for $1 million in term life coverage:

  • Private pilots under 300 hours: $100 – $250
  • Private pilots over 300 hours: $60 – $150
  • Major airline pilots: $30 – $80
  • Commercial charter pilots: $70 – $120

The figures above assume a 30-year-old pilot in good health. Cost ranges demonstrate wide variability based on experience, license type, annual flying hours, and other factors. Permanent insurance also averages 2-5x higher costs than term life coverage.

Comparing Top Insurers of Life Insurance for Pilots in Canada

When evaluating carriers, key considerations include:

  • Pilot classification systems
  • Qualifications for preferred rates
  • Scope of aviation questionnaires
  • Available exclusions and riders
  • Willingness to cover all license types

The table below provides a sample comparison between two leading Canadian insurers:

Policy FeatureSun LifeManulife
Years in Business154130
Pilot ClassificationsCommercial, Private, SportCommercial, Private
Preferred Rates Available?Yes, if meets criteriaYes, if meets criteria
Aviation Riders Available?Yes, at added costYes, at added cost
Sample Monthly Premium*$112$94
*30-year-old commercial pilot seeking $1 million coverage

An experienced broker has access to top-rated insurers and can compare options to find you the optimal fit based on your specific aviation profile.

Tips for Purchasing the Right Life Insurance for Pilots

Follow this advice when buying pilot life insurance:

  • Compare specialized aviation brokers and insurers
  • Optimize risk profiles first by limiting high-risk flight activities
  • Know precise license, experience, and aircraft details upfront
  • Consider both term and permanent policy options
  • Accept exclusions or riders specific to aviation
  • Complete medical and aviation exams fully and accurately
  • Provide all requested supplemental records promptly
  • Work with brokers to appeal any unfavourable underwriting decisions

6 Steps to Buying Life Insurance for Pilots in Canada

Follow this process to secure coverage suitable for your needs:

Step 1. Consult an Aviation Insurance Specialist

Discuss your budget, flying details, and insurance goals. Get quotes from multiple brokers.

Step 2. Evaluate Quotes from Carriers

Compare aviation classifications, policy features, premium ranges, and benefits.

Step 3. Submit Applications and Questionnaires

Provide exhaustive flying history and license/experience details. Avoid errors or omissions.

Step 4. Complete Medical Examinations

Insurers assess health risks like heart disease based on exam results.

Step 5. Finalize the Plan with Your Broker

Choose the right insurer, coverage amount, premiums, and riders.

Step 6. Undergo Formal Underwriting

Approval takes 4-8 weeks on average. Be patient and address any issues promptly.

Where to Buy Life Insurance for Pilots in Canada

Where to Buy Life Insurance for Pilots in Canada
Where to Buy Life Insurance for Pilots in Canada

Pilots have several options when it comes to buying coverage:

Employer or Airline Group Policies

Some airlines and aviation employers offer group life insurance plans as part of pilot benefits packages. These policies provide basic coverage, often 1-2x annual salary, but limited underwriting.

Pros:

  • Guaranteed issue without health questions
  • Premiums partially employer-paid
  • Quick and easy to obtain

Cons:

  • Low coverage amounts
  • Lost if you change jobs
  • Limited customization

Group insurance works well for supplemental coverage, but most pilots need additional personal policies.

Independent Aviation Insurance Brokers

For optimal policies and rates, working with an independent broker specializing in aviation insurance is highly recommended. These experts have access to a wide range of carriers and products.

Pros:

  • Access to the full market of specialty insurers
  • Experience with pilot underwriting precedents
  • Policy optimization based on your specifics
  • Advocacy with underwriters for best class
  • Appeal support for claim denials

Cons:

  • No direct insurer relationship

With intricate pilot underwriting procedures, an expert broker can prove invaluable by comparing dozens of carriers to find the best fit.

Direct Insurance Company Websites

You can apply for coverage by contacting insurance companies directly, either online or over the phone.

Pros:

  • Direct-to-insurer application
  • Potentially simpler process

Cons:

  • Limited to one company’s products
  • Lack of specialized policy optimization
  • No underwriting negotiation leverage

While convenient, you miss out on a broker’s market expertise in negotiating favourable classifications and rates.

Online Insurance Marketplaces

These aggregator sites allow you to easily compare quotes from many insurers in one place.

Pros:

  • A quick way to compare multiple carriers
  • Offers a range of policy types

Cons:

  • A limited subset of insurance companies
  • Still lack focused aviation expertise

Marketplaces get you quotes swiftly but may lack specialized brokers’ aviation insights and expansive insurer access.

Settling a Claim for Life Insurance for Pilots as a Beneficiary

Follow these steps if you are the beneficiary of a deceased pilot’s life insurance policy:

1. Contact the Insurer Within 5 Days

Notify the insurance provider within 5 days of the pilot’s passing to open a claims file. Provide basic personal details and policy number if available.

2. Submit Official Documentation

Provide certified copies of the death certificate along with any claim forms provided by the insurer. Also, send over copies of autopsy or accident reports if applicable.

3. Provide Supplemental Details if Requested

Insurers may request additional records relating to the circumstances of the death, like pilot training logs or medical history. Respond promptly to requests.

4. Select Your Payment Method

Choose whether you want to receive claim payouts in a lump-sum or installments over time. Lump sums are frequently preferred.

5. Wait for Claim Processing

It takes most insurers between 2-6 weeks to validate claims against policy terms. Payouts are usually made within 30 days.

6. Appeal Denials with Your Broker

If your claim is denied, immediately consult your broker or agent to identify grounds for appeal. Quickly gathering additional details can facilitate approval.

Having a complete understanding of the claims process as a beneficiary ensures you receive owed payouts smoothly. Experienced aviation brokers can prove invaluable advocates if initial denials occur.

Takeaways for Canadians Seeking Life Insurance for Pilots

As a pilot, obtaining specialized life insurance coverage is crucial but requires expert guidance. The right policy delivers vital income replacement and financial stability for your family should the worst occur while flying.

Although premiums exceed typical policies, having proper benefits in place provides significant peace of mind. Work with a knowledgeable broker to secure insurance that fits your aviation lifestyle and budget. Your flying career comes with inherent risks, but the right life insurance plan can mitigate them when it comes to protecting your loved ones.

In addition to life insurance for pilots, we also offer insights on life insurance for high risk occupations, such as life insurance for police officers, Life Insurance for Firefighters, Life Insurance for Merchant Mariners, Scuba Divers, etc. If you work in a hazardous profession, be sure to read our guides to getting affordable coverage.

Next Steps for Getting Covered

For your free quote from top Canadian life insurance companies, visit Life Buzz today and start your application. Take control of your financial security.

Life Insurance for Pilots : Frequently Asked Questions (FAQs)

How is life insurance for pilots different than typical policies?

Life insurance policies designed for pilots provide higher death benefits and include riders covering aviation deaths. Insurers also require details on pilots' experience, licenses, medical history and aircraft types.

What are the most important factors of life insurance for pilots?

The key factors for pilots are total flight hours, types of aircraft flown, geography, specialized maneuvers performed, aviation medical exam results and FAA certifications/ratings held.

Who needs to get life insurance for pilots the most?

New pilots are just starting training, commercial airline pilots, older pilots are facing higher risks, and pilots with families dependent on their income need coverage the most.

Does life insurance for pilots cost more than regular insurance?

Yes, premiums for life insurance for pilots average 10-15% higher than comparable policies for non-pilots in the same age and health category.

Is it difficult for student pilots to get life insurance for pilots?

Student pilots will pay the highest premiums due to limited flight hours. However, coverage is available through a focused aviation life insurance broker.

Can you get life insurance for pilots with pre-existing health conditions?

Yes, you can get life insurance for pilots with medical conditions, but you may pay higher rates. Some conditions could potentially lead to a denial of coverage.

How long does it take for pilots to get approved for life insurance?

Underwriting of life insurance for pilots typically takes 4-8 weeks. The aviation questionnaire lengthens the application process over regular life insurance.

What types of data do you need to provide when applying for life insurance for pilots?

You'll need to submit documentation like pilot licenses and certificates, FAA records, medical clearances, flight logs tracking hours, and detailed flying history and experience.

Can you get life insurance for pilots over age 70?

Coverage is available but limited for older pilots over 70. You may need to accept exclusions for aviation deaths depending on insurer underwriting guidelines.

What are the main reasons that claims of life insurance for pilots get denied?

Common reasons for denial are undisclosed medical history, inconsistencies in flight details provided, failure to meet experience requirements, or high-risk specialized flying activities.

Do life insurance for pilots rates go down over time?

Yes, rates can improve for pilots who accumulate substantial additional years of incident-free flying experience and obtain advanced pilot certifications and ratings.

Is life insurance for pilots more expensive for experimental aircraft?

Yes, premiums for life insurance for pilots are significantly higher if you fly experimental, amateur-built, or antique aircraft compared to standard production planes.

Can you get life insurance for pilots with DUI violations?

DUIs will raise your rates, but coverage is still available. The DUI must be disclosed along with any license suspensions and specific circumstances.

What medical tests are required when applying for life insurance for pilots?

A current aviation medical examination, complete blood work, urinalysis, and, in some cases, an EKG are required. Older pilots may need extensive exams.

How do you find the best rates of life insurance for pilots?

The best rates come from an independent broker who can shop your policy to multiple specialized aviation life insurance carriers and negotiate the optimal deal.

Does life insurance for pilots cost more for IFR versus VFR pilots?

Yes, instrument-rated IFR pilots tend to receive better rates than those who are only rated for visual flying. IFR certification signals greater experience.

Can dangers like mountain flying affect pilots' eligibility for life insurance?

Yes, insurers may decline coverage or add exclusions if you frequently fly over hazardous mountainous areas, oceans, deserts or remote terrain.

Are there ways for pilots to reduce the cost of life insurance for pilots?

Pilots should reduce high-risk behaviors, obtain advanced ratings/certifications, choose less hazardous flying geography, and maintain excellent health to lower premiums.

How long does life insurance for pilots coverage last?

For term policies, duration is typically 10-30 years. Permanent policies like whole life provide lifelong coverage. Some term policies are convertible to permanent coverage.

Article Sources:

To understand how we uphold our commitment to precision, openness, and impartiality, we invite you to review the Editorial Policy at Lifebuzz.ca. Our reputation as the most reliable source for life insurance news in Canada is a testament to our integrity.

  1. Life Insurance for Pilots and Aviation Enthusiasts – https://lsminsurance.ca/
  2. A Guide to Life Insurance for Pilots – https://www.dundaslife.com/
  3. Applying for Life Insurance as a Pilot in Canada – https://protectyourwealth.ca/
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Written by Ben Nguyen

Ben Nguyen is an award-winning insurance expert and industry veteran with over 20 years of experience. He is the chairman and director of IDC Insurance Direct Canada Inc., one of Canada's leading online insurance brokerages.

Ben is renowned for his extensive knowledge of life, health, disability, and travel insurance products. He is the prolific author of over 1,000 educational articles published on LifeBuzz, BestInsuranceOnline, and InsuranceDirectCanada. His articles provide Canadians with advice on making smart insurance decisions.

With a Bachelor's degree in Actuarial Science and a Fellow of the Canadian Institute of Actuaries (FCIA) designation, Ben is frequently interviewed by media as an insurance industry spokesperson.

He has received numerous honors including the Insurance Council of Canada’s Pivotal Leadership Award, the Canadian Insurance Hall of Fame induction, and the President’s Medal from the Canadian Institute of Actuaries.

Ben continues to shape the vision and strategy of IDC Insurance Direct as chairman. He is dedicated to advancing the insurance industry through his insightful leadership.

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