Posted by: Tom Chappell | February 11, 2010

Broad Form Policies – Extra Expense Coverage

The more desirable an underwriter finds a risk, the more he is willing to offer in the way of policy enhancements.  For the multiple aircraft fleet, turbine or jet, that is corporately owned and operated by a professional flight department, the policy extensions available are numerous.  For the less professional risk or the commercial (Part 135) operation, policy extensions may become totally unavailable.  Check your policy or talk with your agent.  If you don’t already have a broad form policy or a broad form expansion endorsement, it is certainly worth your time to inquire about your eligibility.

Extra Expense Coverage: If your aircraft is damaged and the loss is covered by your policy, the extra expense extension allows for the leasing or renting of replacement aircraft during the repair period.  This coverage is designed to cover only the additional expense that you incur as the result of the loss.  For an example, fuel expense for a rental aircraft would not be covered.  In addition, most policies limit the daily expense and the maximum amount covered by the policy.  A typical limit would be $3,333 per day for 30 days ($100,000) or $5,000 per day for a maximum of 90 days ($300,000).

Extra Expense For Temporary Replacement Parts: This coverage is similar to the extra expense coverage described above.  In the event of a covered physical damage loss, this extension allows for the rental of temporary replacement parts including installation, removal, and transportation.  In like fashion, this coverage has policy limitations.

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