Paul, Duane Swing, owner of Velocity Aircraft, has written several articles
in the Velocity Views on the insurance problem for Velocity's.
Unfortunately, there have been a number of crashes involving Velocity's,
such that the insurance companies, particularly Avemco, were unwilling to
provide coverage (hull or liability) unless a number of things were done
(flight training, factory inspection, etc). Apparently, a lot of these
accidents were caused by poor practices of the builders, whether in
building the plane, or in operation of the plane, plus they were
overinsured ($150K on a $80K plane). Avemco has (or will) paid out much
more in losses than the premiums collected. I work for an insurance
company, and that is a definite no-no, if you want to keep your job.

Duane is working with the experimental aircraft insurers (Avemco, etc) to
develop a set of reasonable requirements, so that they will again provide
coverages.  I think you can understand the importance of this to his
business.  They probably asked him if auto engines are as reliable as a/c
engines, and I don't believe he feels that they are, so I suspect that they
just made it a underwriting rule-no auto conversions. If they can improve
their underwriting results (have fewer losses), then things will ease up
for Velocity aircrafts to the point where you might be able to buy hull and
liability coverage, even on an auto conversion.

Chuck Harbert

p.s. I have London Aviation Underwrters for Liability only ($1MM
smooth-won't do hull on my plane) thru Lockton (broker) out of Denver, but
they're non-renewing in July. I'll be looking for another insurance carrier
at that time. I hope to have the Lyc 540 installed and the 25 hrs flown off
by then. AOPA Ins Services found LAU and one other market for me 2 yrs ago,
when Avemco said they wouldn't provide operational coverage due to the
experimental engine. Thx everybody for the name of the other insurance cos.
I'll contact them.

 
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