Aviation-related businesses operating within the Australian aviation market continue to see effective business planning as a key component of long-term growth. Michael Gilmore, writing in Aviator magazine recently, warned that flight schools must “radically alter their concept of core business and develop business plans that allow them to access more of the disposable income that still exists within the aviation community” (Making a Small Fortune in Aviation). His advice could easily be expanded to other businesses within the Australian aviation sector.

With the Australian economy still lagging, sales are sluggish to flat, and many entrepreneurs and business leaders are looking to cost-cutting and cost-avoidance measures to build the health of their businesses. Taking a cold, hard look at your business − in conjunction with developing a sound business plan – is sound advice, especially when coupled with an effort at cost reductions and minimizing risk and liability.

For many small and mid-size businesses serving the aviation marketplace, reducing overhead and risk are paramount for 2011. Business planning can go a long way in helping companies achieve this objective. The Australian government has a great number of resources to help business owners develop and write a business plan. You can find many useful tools and templates available at no cost at Business.gov.au. A critical part of any business plan for aviation-related businesses, however, will involve a critical examination of overhead costs, and this means taking a hard look at your business liability insurance and assessing your level of risk for liability claims. This will take the expertise of an experienced aviation insurance broker.

A comprehensive review of a company’s risk exposure and liability coverage needs, coupled with competitive bidding available through an aviation insurance broker, is often an important first step. The broker is the business owner’s risk management expert, able to professionally differentiate between types of policies, and which insurance companies are the best matches for any given business.

“Working within the aviation industry requires a very good understanding of risk,” said Bill Owens, owner and director of one of Australia’s leading insurance brokerage firms, Bill Owens Insurance Brokers. “Many small and mid-size companies can have a hard time finding coverage, much less the type of coverage that will suite their individual needs,” said Owens.

But because of the high cost of aircraft and the resulting average liability claim, customers are reluctant to do business with a company that is under-insured. Reviewing your coverage and insuring you are able to market your company as a reliable partner is simply good business, especially in these particularly hard economic times. Unfortunately, the complexity of the policies and understanding what is and isn’t covered can be a difficult process for a business owner, making choosing the right insurance broker an even more important decision. A case in point is the typical Hangar Keepers Liability Insurance package.

In Australia, businesses serving one of the many niches within the sector, will find Hangar Keepers Liability Insurance an important addition to their liability portfolio. Broadly speaking, Hangar Keepers Liability covers three key areas:

1. Section I. Often referred to as the public liability section, Section I deals with claims made against inadequate equipment or parts, and against poor operational decisions made by your employees.

2. Section II. Damage to aircraft and aircraft parts and equipment is covered under Section II. This section provides your company with coverage should your business be held liable against damage to the aircraft themselves, or the aircraft parts and equipment. Also, this section specifically covers damage while you are working on, or servicing the aircraft.

3. Section III. This critical part covers the same types of damage as does Section II, but instead of providing coverage while you are servicing a customer’s plane or helicopter this section provides coverage for any liability that may occur after you have finished delivering your products or services, but before the aircraft is returned to its owner or owners.

Unfortunately all Hangar Keepers liability insurance policies are not the same, and determining which policy a business needs requires a trained broker with experience in the industry. Again, Bill Owen: “Getting a quote is more than just completing a questionnaire full of check boxes. Our insurance specialists (most of the team holds diplomas in Financial Services specializing in insurance brokering) are better able to deal with clients when we’re able to discuss their situation and needs in greater detail.”

Reviewing your liability overhead costs and needs is part of any good business plan for a business operating in the Australian aviation industry. Acting now can position your company for improved growth as the Australian economy continues to heat up during 2011-12.

Michael O’Bryan writes. Michael also writes for the Facebook chat software “Chit Chat.” Chit Chat is a Facebook client that facilitates the sending and receiving of Facebook messages from ones desktop.

The exposure to liability risk for the owners and operators of aviation-related businesses is a constant threat to long-term viability. General liability insurance does not address the specific needs of companies who work within one of the many niche markets that make up the Australian aviation industry, and the complexity of the various types of policies can make choosing the right coverage difficult for the average business owner. Further complicating the process can be the difficulty of getting coverage for the many unique types of businesses that operate to serve a sector of the Australian aviation market. 

Choosing the right Hangar Keepers Insurance Liability plan can be a crucial first step according to industry experts; one that makes working with an insurance broker with the necessary knowledge and experience in aviation liability risk a prudent decision.

In Australia, Hangar Keepers Liability Insurance is a generic term used to describe coverage that protects the business owner from the liability associated with servicing and repairing business aircraft, and the vast majority of companies that operate an aviation-related business will need some form of this type of insurance. The wisdom of working with an insurance broker to help meet your needs for Hangar Keepers Liability Insurance becomes apparent when the combination of the complexity of the coverage available is coupled with the incredible diversity of the businesses that will need coverage.

“The exact needs of any business will vary based on their level of risk,” says Bill Owen, the Director of Australia’s Bill Owen Insurance Brokers. “But every business within the aviation industry will need some level of Hangar Keepers Liability Insurance. The key is getting the exact coverage you need at a price that makes financial sense.” Companies who specialize in baggage handling, aircraft maintenance and repair, aircraft painting, aircraft refueling and even food and beverage providers will all need a Hangar Keepers Liability Insurance policy tailored to meet their specific needs and levels of risk.

Generally speaking, Hangar Keepers Liability Insurance covers three broad areas of risk, referred to as sections within the aviation insurance profession. Section I of Hangar Keepers Liability Insurance deals with what is known as Public Liability, and covers liability that may be adjudged against your business due to faulty equipment and materials or due to poor decisions made by your employees. Coverage will include the costs associated with liability for the loss or damage to property or bodily injury and death. These worst case scenarios are often difficult for many business owners to deal with because most businesses are run by people who believe in the quality of the products or services they provide, but they cannot be overlooked or avoided.

Section II of Hangar Keepers Liability Insurance covers damage to aircraft and aircraft components while they are under the care of a business that is providing a service or product to the owners of an aircraft. This coverage protects you against liability while you are providing the very products and services you are in business to offer.

And finally, Section III of Hangar Keepers Liability Insurance protects you against damage to the same aircraft and aircraft components after you have finished providing service, but no longer under your control.

This simple breakdown of the three sections of Hangar Keepers Liability Insurance is broad at best. And while a general understanding of the complexities of Hangar Keepers Liability Insurance is a good start, it cannot take the place of consulting with an independent insurance broker who can give targeted risk mitigation guidance based on their knowledge of your unique business objectives, the financial health and position of your company, and the specific needs that the services you offer dictate. Additionally, the specific coverage and policy wording will vary between insurance providers, and you should review each alternative carefully with your broker.

Michael O’Bryan writes. Michael also writes for the Facebook chat software “Chit Chat.” Chit Chat is a Facebook client that facilitates the sending and receiving of Facebook messages from ones desktop.