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Fleet Policy Aircraft

Fleet Policy, Aircraft

Definition

The fleet policy typically affords both liability and hull coverages. Compared to a stand-alone nonowned aircraft liability policy, a fleet policy offers a number of benefits for an aircraft owner: coverage is generally broader and more cost effective; losses under the fleet policy will affect the aircraft management firm's (AMF's) loss history rather than the owner's loss history; the AMF handles claims; and, because coverage is handled by a single party (the AMF) rather than being divided between the owner and manager, coverage gaps are less likely. Disadvantages include dilution of limits, possible policy cancellation by the AMF, and the aircraft owner likely being barred from suing the AMF for faulty maintenance.

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