AIRPORT OPERATIONS LIABILITY INSURANCE

For aviation insurance brokers and insurers , it is important to understand the risks and liabilities in airport operations in order to create policies and premiums. It is also useful for aviation service providers to know what consists in the airport operations and liabilities policies.

Airport operations liability insurance covers the liability of entities which operate and provide facilities at airports, including airport owners and operators, hangarkeepers , air traffic control services, maintenance, repair and service facilities, aircraft refullers and flying clubs and schools.

The liabilities of airport operators are usually divided into three broad categories for insurance purposes, viz , airport premises liability, products type liability, and hangarkeepers liability.

The main categories of airports are: (1) private airfields and airports; (2) local government airfields and airports; (3) general aviation airports; (4) major airports; and (5) helipads and heliports.

Airport premises Liability Insurance

Airport premises liability covers the liability of an owner or lessee of premises at an airport for loss, damage or injury occurring on the premises, usually as a result of the owner’s or lessee’s fault. Coverage?may be provided in respect of liability to the owner of a motor vehicle for damage caused in the parking area; injury sustained by passengers or visitors in an airport building; illness or injury sustained by the consumption of contaminated food sold in an airport; ;damage to the aircraft and death of?or injury to passengers caused by the negligent direction or inadequate warning of a ground marshal or air traffic controller, or the inadequate marking of obstructions on the airport runways or taxiways; and damage to aircraft and death of?or injury to passengers caused by the failure properly to maintain runway surfaces, the approach areas surrounding runways and other air navigation facilities, such as instrument approach and landing guidance systems, approach lights or marker beacons.?????

Cover granted by the policy

SECTION 1

This section of the policy covers any bodily injury or property damage caused to third parties in or about the premises specified due to or as a consequences as a direct result of the services granted by the insured, elsewhere in the course of any work or of the performance of any duties carried out by the insured or employees in connection with the business or operations specified in the schedule caused by the fault or negligence of the insured or any of his employees engaged in the insured’s business or by any defect in the insured’s premises, ways, works machinery or plant used in the insured’s business ( e.g. passenger trip and fell on the slippery floor and got injured, death due to fall from the escalator, food poisoned at the restaurant, reckless behavior of staff caused injury to passengers, fault of elevator, accident caused by buggy transporting passengers, damage to the cars parked.

This section is subject to the following exclusions

(1) Any loss or damage to property owned or occupied by or in the care, custody or control of the assured or of any servant of the assured.

(2)(a) Any loss or damage caused by any propelled vehicle used by the assured and which may be subject to another insurance under any law or where such vehicle is on any public highway

???(b) Any ship, vessel, craft or aircraft owned, chartered, used or operated by or on account of the assured

(3) Unless otherwise agreed by the underwriters:

(a) Property damage or bodily injury arising out of any air meet, air race, air show or similar accommodation of spectators.

(b) Bodily injury or property damage arising out of construction of, demolition of or alterations to buildings, runways, or installation by the assured or contractors or sub-contractors (other than normal maintenance operations.)

(C) Bodily injury or property damage arising out of any goods or products manufactured, constructed, altered, repaired, serviced, treated, sold, supplied, or distributed by the insured or his employees after such goods or products have ceased to be in the possession or under the control of the insured, (but this exclusion shall be deemed not to apply to the supply, by the insured, of food or drink at the premises.

SECTION 2 (Hangar keeper’s Liability)

Loss of or damage to Aircraft or Aircraft equipment, not owned, rented or leased by the insured, whilst on the ground in the care, custody or control of or whilst being serviced, handled or maintained by the insured or any servant of the insured. However, this applies only in respect of such goods or products which form part of, or used with, aircraft; and then only after they have left the possession or control of the insured.

EXCLUSIONS

(a) Loss of or damage to robes, wearing apparel, personal effects or merchandise of any description.

(b) Loss of or damage to aircraft or aircraft equipment, hired or leased by or loaned to the insured.

?(c) ?Loss of or damage to any aircraft while in flight as defined.

SECTION 3 (Products Liability)

?The aircraft owners, as well as operators which maintain, service, repair, or supply aircraft parts at an airport. Bodily injury or property damage arising out of the possession, use, consumption or handling of any goods or products manufactured, constructed, altered, repaired, serviced, treated, sold, supplied or distributed by the insured or his employees, but only in respect of such goods or products which form part of or are used in conjunction with aircraft, and then only after such goods or products have ceased to be in the possession or under the control of the insured.

EXCLUSIONS

(a) Damage to the property of the insured or to property within his care, custody or control.

(b) The cost of repairing or replacing any defective goods or products manufactured, constructed, altered, repaired, serviced, treated, sold, supplied or distributed by the insured or any defective parts thereof

(c ) Loss arising out of improper or inadequate performance, design or specification (not excluded when bodily injury or property damage)

(d) Loss of use of any aircraft not actually lost or damaged in an accident giving rise to a claim hereunder

EXCLUSIONS APPLICABLE TO ALL SECTIONS OF THIS POLICY

Airport operators’ policies normally exclude bodily injury to employees or agents of the insured, and the cost of making good faulty workmanship, although resultant damage will be covered. Air traffic control operations are also excluded, but can be added

The other three exclusions are similar to the aircraft policy:

* War and associated perils;

* Radioactive contamination;

* Any contract where the insured assumes liability unless liability have attached in the absence of such agreement.

THIRD PARTY SERVICE PROVIDERS LIABILITY INSURANCE?

This type of insurance cover gives liability protection for third party service providers who provide various functions at airports in both landside and airside areas for air carriers. The type of services provided are: ground handling, baggage handling, cargo handling, catering, cleaning, check in services and air bridge operations. The contractor/ service provider is exposed to liability in the event of bodily injury to passengers and/or property damage to third party property. In addition to the liability under the applicable common law, the activities of third party service providers are usually performed pursuant to contractual arrangements. In addition to contractual performance obligations, these types of contracts may hold harmless and indemnity provisions as well as various insurance requirements.

GROUND HANDLERS LIABILITY INSURANCE

Ground handlers’ liability insurance provides coverage in respect of the risks associated with the airside handling of aircraft including ramp turn-around, baggage handling, aircraft cleaning and aircraft marshalling. Ground handling relationships, between the air carrier and the ground handler are almost always contractual in nature and often the parties utilise the IATA standard ground handling agreement

AIR MEET INSURANCE

The organizer or sponsor of an air display or meet can incur liability to spectators, third parties and perhaps even participants, for injury or death or loss of or damage to property and thus require insurance cover in respect of those risks. Coverage for air meet liability, generally available as a standalone cover or reinstated coverage previously excluded in an airport premises policy, provides for the insurers to indemnify the insured for all sums which the insured is held legally liable to pay as compensatory damages arising out of an occurrence which causes bodily injury or property damage directly in connection with the air meet organized and/or sponsored by the insured at the location specified in the policy schedule (Air Meet Global 147)?

EXCLUSIONS

The policy usually excluded liability in respect of bodily injury or property damage caused by any mechanically propelled vehicle used by the insured in circumstances which are covered by any motor insurance law or where no such law exists, while the vehicle is on a public highway; property damage to property which the insured owns, leases, rents, uses or occupies or which is in their care, custody or control for their own use; bodily injury to any person arising out of and in the course of their employment by the insured, or liability for which the insured or his insurer may be held liable under ay workers compensation or similar law; bodily injury or property damage caused by ay participant in the air meet or by any participating aircraft, vehicle or device; bodily injury or property damage arising out of the insured’s use of any aircraft which they own or which is operated on their behalf; bodily injury or property damage arising out of the use of pyrotechnics; and liability assumed by the insured by agreement under any contract unless such liability would have attached to the insured even in the absence of such agreement. This policy will also generally exclude war and allied perils, nuclear risks, noise pollution and other perils and punitive, aggravated or exemplary damages.

FLYING CLUBS AND FLYING SCHOOLS

Flying clubs and organisations which provide flying instruction, and which hire out aircraft, may incur liability to members, student and renter pilots and passengers and third parties, for loss damage or injury (including death).where the aircraft is leased from its owner by the organisation operating it, liability may also?be incurred for loss of or damage to the hull. In addition to conventional theories of liability, liability in these situations might be based on negligent instruction of, or failure to warn, the student pilot, and negligent entrustment of the aircraft to an unqualified or incompetent pilot.

Cover in respect of a flying club or flying school may be written by means of a suitably adapted comprehensive aircraft policy, or standard airport owners and operators policy. Standard policy wordings are available covering flying and gliding clubs and their operations.

The persons entitled to indemnity under a policy effected on behalf of a flying club may depend on the legal nature of the club, i.e. whether it is a proprietary club or a member club. In the case of an aircraft hired by a person who is not a member of the club, in the absence of a specific provision in the policy, the person hiring the aircraft will not be entitled to the benefit of insurance effected on behalf of the club.

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