Lead Sled said:
Assuming that you can get the insurance company to add your name to the policy, you'll have the same coverage and protection that the owner has.
That's right. Unfortunately, the owner doesn't have any protection for giving flight instruction. That is defined as a commercial activity and specifically excluded from coverage in every owner policy I've ever seen.
Personal FAQ:
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Named Pilot, Named Insured and other Myths
Watch out for this. It is a =very= common misconception that being listed as a "named pilot" on someone's insurance policy protects you when you're instructing.
Insurance contracts are highly technical documents. Terms like "open pilot warranty," "named pilot," "named insured," and "waiver of subrogation" mean very specific and very different things.
An "open pilot warranty" is a promise that the owner of the airplane makes to the insurance company that no one that doesn't meet certain stated minimums will be permitted to act as PIC of the airplane. But the insurance does not protect the "open pilot".
"Named pilot" only means that the insurance company agrees to permit a specific pilot to act as PIC of the airplane, even if that pilot doesn't not meet the "open pilot warranty." But the insurance does not protect the "named pilot".
Being listed as a "named insured" means that the insurance company will treat you as one of the people p[protected by the policy. a specific person as one of the owners of the airplane for insurance purposes. Of the three terms, this is the only one that protects the pilot, and there may be limitations.
"Waiver of subrogation" means that the insurance company will not sue, even though it has the right to. A simple way to understand this is in the automobile insurance context: If some other driver slams into your parked car, that other driver is liable for your damages, and you have the right to sue him, if necessary, in order to collect. If you have collision coverage, your insurance company takes care of your loss. But the insurance company also takes over your right to collect from the person who is really responsible. That right to take over your claim is called subrogation.
Here's some examples that illustrate the differences. A is the owner and the primary insured on the insurance policy. B is another pilot.
1. B does not meet the "open pilot warranty" on A's policy. There is an accident that is arguably B's fault. B was acting as PIC on the flight.
Result: A has no insurance coverage. Period. No hull coverage and no protection in case someone else or his property was damaged.
2. Same as 1 but B meets the "open pilot warranty".
Result: The insurance company covers A's claim for hull damage and protects A in case someone else or his property was damaged. The insurance company may go after B ("subrogate") to collect everything it paid for or to A. In addition, B has no protection in case the "someone else" whose person or property was damaged.
3. Same as #1, but B is a "named pilot".
Result: Same as #2. No difference.
4. Same as #1, but B is a "named insured" or "additional insured" on A's policy.
Result: The insurance company covers A's claim for hull damage, protects both A and B in case someone else or his property was damaged, and will usually not subrogate against B.
The catch is that even #4 assumes that B was =not= giving flight instruction to A. Owner insurance contracts typically contain a provision that specifically excludes commercial activities, defined as including flight instruction. The Avemco owner policy, says this about four different ways, including the statement that
However, persons or organizations who are in an aviation business are not insured persons when the accident arises out of, or occurs during, the conduct of such aviation business.
"Aviation" business, of course, is defined as including " providing pilot, crew or flight instruction services. "
So even if B =is= a named insured, he's not an insured when he's providing instruction.
Whether B has any protection at all when instructing A depends on the existence of endorsements or agreements that are usually outside the basic insurance contract. They take a number of forms, the most common being a waiver of subrogation against the flight instructor. And even =that= doesn't protect the CFI from a third party lawsuit.
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