Warbird Information Exchange

I know a bunch of y'all here are A & Ps &/or IAs. If you have your own shop, do you carry liability insurance? If not, is it cost or just don't care or feel the need? If you don't own your own shop but work for one & if you know, do they or don't they? Just trying to get a little ammo, er, info, for my airport board. Thanks.

Meaning they want to close ppl down if they don't have insurance?

_________________
Those who possess real knowledge are rare.

Those who can set that knowledge into motion in the physical world are rarer still.

The few who possess real knowledge and can set it into motion of their own hands are the rarest of all.

I was quoted $5500. per year. glendale airport has had me removed from the airport by the police because I will not get insurance. The thing is, they want the insurance to cover them, and not me, and I will not pay to cover the airport unless they make the same demands on all aircraft that operate out of there.

A couple of months later, I was at glendale to do a run up and if everything went well, to fly a Tri-pacer he had just bought. THe city workers showed and and threatened to call the police on me unless I left the airport. I told them I was not working on a plane, but was there to fly a plane, and if they tried to stop me, I would end up owning the airport. The owner of the plane told the city guys to get lost.

I just found out that we have a $100k deductible on our company truck.

_________________
"Hindsight is usually 20% off!"

A local big FBO has approx 100 million in coverage. Deductible is $1.5 million. Don’t know what the monthly premiums are. When the GA manufacturers got legislation passed eliminating their liability for older aircraft, the insurance company said they wanted an additional $500,000 per year if the FBO continued working on aircraft older than 15 years.


Most airports will not allow you to conduct business of any kind without a huge insurance policy. Want to service GSE from your pickup truck at a medium sized airport? Minimum ten million dollar policy.


I was quoted $23,000/yr to work on older GA aircraft as an AP/IA, with a multi million dollar policy. Many airports will not allow independent mechanics or even aircraft owners to work on aircraft on the field. They give an FBO a monopoly in return for higher rent/fees to the airport. The FBOs I have worked at will seriously try to destroy an independent mechanic any way they can. I’ll be going out on my own soon, and I know it’s going to be a vicious business.


Hang around GA long enough and you’ll see some fantastically stupid lawsuits. Here’s two I was privy to...

Pilot forgets to refuel, runs out of gas, crashlands. Confesses this to FAA. Months later he decides to sue everyone who ever worked on the fuel system, as far back as TWELVE YEARS. The shops settle out of court for 10-20 grand each, just to avoid the higher cost of litigation.

Another pilot ran his twin several hundred hours past TBO. Engine quits, he crashlands and gets seriously injured. FAA report found minimum to NO compression on some cylinders. He sues last shop that overhauled the engines. Settled out of court for some serious $$$.

There are two other lawsuits I cannot comment on yet, but are equally idiotic. When someone does something stupid in aviation, they usually try to blame/sue someone else. For something really disturbing, read the lawsuit that put Piper Aircraft out of business years ago. When I was at the Beechcraft factory years ago, a rep said almost $100,000 of the cost for a new Baron was for product liability. Ain’t it wonderful what trial lawyers and 12 brain-dead jurors can do?


There is a small shop nearby that was practically sued out of existence by a BS lawsuit. The owner is open again, but not as a repair station. He rents his hangars and shop equipment to his former mechanics, who have garnered their own customers. He doesn’t do any maintenance work himself.

I know several big FBOs, and some smaller shops that will deliberately avoid working on aircraft owned by lawyers or law firms. Too many times they have threatened a lawsuit, when trying to bully a shop into a better deal for themselves.

I think it would be incredibly foolish to go without insurance in any aviation business.

TinBender2 hits a major point......


I think it would be incredibly foolish to go without insurance in any aviation business.

I do a lot of aviaition photography now. (I retired from being a lawyer). I can say this, I know a PHOTOGRAPHER (no names since you will all pretty much recognize him) who was shooting an expensive (like $40mill plus) biz jet's interior for a sales ad. He turned and scratched a cabinet. Thank god for insurance, it was a bit over $25k to repair.... So if you do anything with other people, you need insurance.


I was a lawyer for 17 years (and I never sued anyone but the State Worker's Comp Commissioner so no flames here), without getting into "Its the lawyer's fault" (since they can't do anything until YOU come to their office to sue someone) and they really don't get anything unless in the end (assuming no settlement) they can convince a jury (made up of people like you; most of whom try like he11 to get out of jury duty) that something was wrong and as such $$ should change hands.


Over the years I've heard stories like those below many times and a lot come to urban legend acquiring a life of their own. If you are darn sure nothing was done wrong DEFEND. I was sued for malpractice once and the defense was defend to the limits. Case was baseless and it got dismissed. If you didn't do anything wrong defend it....

As you guys kick lawyers in the teeth, it seems like the "slick trial lawyers" who happen to buy warbirds are revered as really good guys here and not the scum of the earth you would otherwise call them.

Mark H

Pilot forgets to refuel, runs out of gas, crashlands. Confesses this to FAA. Months later he decides to sue everyone who ever worked on the fuel system, as far back as TWELVE YEARS. The shops settle out of court for 10-20 grand each, just to avoid the higher cost of litigation.

Another pilot ran his twin several hundred hours past TBO. Engine quits, he crashlands and gets seriously injured. FAA report found minimum to NO compression on some cylinders. He sues last shop that overhauled the engines. Settled out of court for some serious $$$.


There is a small shop nearby that was practically sued out of existence by a BS lawsuit. The owner is open again, but not as a repair station. He rents his hangars and shop equipment to his former mechanics, who have garnered their own customers. He doesn’t do any maintenance work himself.

I know several big FBOs, and some smaller shops that will deliberately avoid working on aircraft owned by lawyers or law firms. Too many times they have threatened a lawsuit, when trying to bully a shop into a better deal for themselves.

_________________
Fly safe or you get to meet me .......

Something like that. Nearly 3 years ago, my airport finally got an Airport Board. Prior to that, it was overseen directly by the City. (Sort of like, 'leave us alone, but be sure that rent & flowage fee's on time'.) Prior to that, the FBO had been had been privately owned for the previous 30+ years. I did 'OK' financially running the FBO & working on a/c on the side for the previous 15 years, & just working on a/c for the few years prior to that. Never had shop insurance, but had FBO insurance. The FBO & shop were 2 separate operations. Over the years, aviation locally has dwindled. (surprise, surprise). The Board took over in early '06 & offered to hire me to run the FBO, partly 'cause I own everything here, except the buildings, fuel farm & the ground anyway. We first started discussing salary & equipment leases & it went downhill from there. They finally made a counter-offer & wanted me to keep doing a/c repairs to supplement my lower pay & keep a mechanic on-site. After all of that was agreed to they THEN told me I had to have shop insurance. I told them I didn't clear enough from the shop annually to justify it, so I never had it & never would. Holy cow, that led to another 3 months of bickering before we got our contract done. (Amazingly enough, my insurance carrier later agreed to add shop insurance to my existing FBO policy at no additional cost.) Previously I was quoted $10K for the shop along with $10K for the FBO annually. At the time, I was down to clearing between $12K & $15K from the shop. I ain't turning wrenches for $2K - $5K annually, not while insurance gets the bulk of it. At the time, I had about a just over dozen or so a/c I maintained. Finally, after the 3 months of bickering (negotiating?). I told them their prior negotiations had not been made in good faith, I would not work on a/c 'cause I'm not working on a/c & the will have to come up with the original salary or I'd just take all my toys & go home & they could figure it out & walked (stormed, actually) out the door & sat on the bench outside the FBO. Several locals were at the meeting & they came to my defense. About 15 minutes later, I was called back in. They offered to pay half my insurance then, which I wasn't really keen on, but it was better than 2 immediate alternatives. Just over 2 years later, I'm now down to a little over half the a/c now that I had then, & they aren't flying. What do you do to a/c that don't fly? Anyway, Like mentioned in other responses, it's for THEIR protection, which is unfounded, as they have nothing to do with my off-duty work & even if involved in a suit, would be thrown out anyway. It's just that mentality. I have a multi-million dollar policy, with a $5K deductible on recips & $10K deductible on turbines. They have no clue as to the number of shops or mechs who have no insurance & don't want to hear about it, either. Once they asked what I'd do in another line of work where I had to have insurance & I told them, it didn't matter, because before I pay an insurance company all my money & can't eat, I'll give it up. At this year's IA seminar, someone asked a question about shops or mechs with insurance. Most folks indicated they had none. Too bad I didn't know it was coming, as I would have been better prepared. Next year's seminar, tho, I hope to try to set up a poll there. Even now, with the $5K deductible minimum, if I don't know someone, transient a/c are pretty much SOL. Ya know, there comes a point when you just can't charge enough to CYA. Thanks for the eyes & ears.

Having insurance is great & I'm all for it, but what's the answer for when you simply can't afford it? Sorry, the answer isn't 'charge enough to cover it'. Nah, I don't think anyone would go for $200 per hour shop rate. Health care isn't the only insurance issue out here. When you choose between paying for insurance or eating, what's the choice? Do you realize how hard it would be for me to come up with even a $5K deductible, much less $10K? In addition to the monthly premium. Like I said, must be time to walk.

That brings up another point. If one doesn't have insurance, they're fairly home free. Sue them? Whatcha gonna get? No one messes with them. Have someone with insurance tho, AKA 'deep pockets', they're done for. I've heard of several suits like you mentioned & the only people who worked on the a/c in the past decade being sued were the ones who had insurance. There's one engine repair shop I use. They dropped their liability insurance when the premium went to nearly $100K annually. The owner says if something happens & they can't make it good enough & they get sued, go for it, they can have it if they really want it! I was rarely concerned in the past until I took on the liability of a $5K deductible every time I did an hour long job on an airplane. Yeah, shop rate $XX per hour, $5K minimum charge.

How about this for selective enforcement. When I was working on Hans's planes at the Glendale airport, the city of Glendale had no problem with it, They would come over and BS with me, but when I was working on a Cessna, on the same airport, I was escorted from the airport by the cops, and told I would be arrested for tresspassing if I was caught working on a plane on that airport again, same guy, same day. I brought that up at the time and was told they had a "arrangment" with Hans.
Since when is doing a job I am certificated for grounds for arrest ? Any aircraft owner has the right to chose his mechanic, and have him work on his plane, nor can any airport deny a aircraft owner the right to work on his own plane as allowed by the FARs. If the insurance was a choice of covering me, that is one thing, but I am NOT going to pay a dime to cover a city owned airport, not when you can operate a plane out of the same airport without insurance.

The shop I was working for on that same field, is turning out shoddy work right now and it is a miracle no one has died yet. I am doing a inspection on a Chief that they signed off last year. I have found a possiable crack in the wood spar( any wood wing experts out here ? I need a 2nd opinion ) , binding ailerons to the point it was almost impossiable to get them out of netural. the main fuel line broke in my hand, the spark plugs were worn well beyond limits, and when I showed them to a Champion rep, he was surprised they were still working. a un approved tail wheel, no range markings on ANY instruments,
Next time I am near glendale, I will swing by and if I see hans's hired mechanic is there, and if so, I think I will call in make them enforce their rules equally.

...I'm not sure I want to work operations for the Reno air races any more....I will have to check if they insure volunteers for accidental damage etc. this could open a whole new can of worms...

_________________
EVERYTHING that CAN fly should be ALLOWED to FLY!
IWO JIMA'S best narative..."GOD ISN'T HERE"
http://www.amazon.com/God-Isnt-Here-Ame ... 0976154706


P: Noise coming from under instrument panel. Sounds like a midget pounding on something with a hammer.

S: Took hammer away from midget.

Yeah with all the fear of law suits won't be long there won't be anything fun to do in this country.
The liability for a shop is the easy one. Like the one guy says don't carry any liablilty insurance. And make sure you set it up so the LLC shop rents every tool and supply it uses. Rent a store front so to say, that you call your shop and maybe have one or two fake projects going on there. And truck the work else where, I know hard to do with an airplane. Anyway that way the shop would always be spiffy for any kind of inspection, and they would see there isn't much there to sue for. I'm sure there are lots of other ways to work around the liability thing.
Going after an overhaul shop for an engine way out of TBO makes as much sense as trying to sue God for metal fatique.

One other item. Since the AP IA is certified by the FAA then that should make the FAA Liable for any and all damages that could be considered caused by the person carring the certificate. Isn't this why all states pretty much have mandatory automobile insurance? Since the state by means of the license admitts that they approve that person to be operating a motor vehicle, that makes them liable for anything said person does with that motor vehicle.
And just like that drivers license, all the AP certificate means is you spent sometime in a class room. Excluding the ones that are true mechanics/technicians, and ones that learned the old fashioned way. I've known some folks with an AP that pretty much didn't know anything about mechanics, I have no idea how they got the license.

Man what a gloomy picture.I remember when aviation was fun.Anyone want to guess when it all went to the dogs?$$$$$$$$$$$

_________________
Hang The Expense

Well,

You all have made some very good points. Perhaps I should clarify some of mine.

I feel liability insurance is mandatory for me, because my customers will be mainly bizjet owners, and most will not let you work on their aircraft without it. I am extremely careful in my work, but I know I’m human and can make a mistake, and the price of parts for these aircraft is astronomical, as is loss of use of the aircraft, minor injury to a million dollar passenger, etc.

I am not pursuing the owners of light single- and twin-engine piston aircraft as clients. As nice as those folks are, IME, most want the cheapest work they can find, including one-eye annuals and pencil-whipping SB/ADs. They seem to be the biggest maintenance liability risk with the least profit. I know guys that are working these type aircraft. They are barely surviving, and have their names all over the logbooks of thrashed airframes being flown by pilots that barely fly 50 hrs a year. Personally, if I was working these aircraft, I’d want liability insurance even if I didn’t have any assets. Say a financially secure pilot crashes and injures his wealthy pax. I would think the pilot would do everything he could to shift blame for the accident onto someone else,(like his mechanic) solely to protect his assets. Do you really want to spend the rest of your life with a massive financial judgement against you? With collections jackals trying to take anything of value you may have in the future?:evil:

My cost for insurance will be rolled into my shop rate. And I still believe I can turn a healthy profit and beat the typical FBO rate by 25% or more. I specialize in structures and airframe mods, and there is a massive amount of work available. My plate currently has nine commuter airliners needing serious corrosion repairs and 18 service kits to install, a King Air wanting 3 major Raisbeck mods, and a King Air mothership conversion that will be controlling UAVs in the sandbox. I recently declined a fleet of CRJs needing corrosion repair, and a pile of VLJs needing airframe mods. And this is without even looking for customers.

If you want to make money in aircraft maintenance, go after the owners that already have a healthy budget set aside for aircraft maintenance. $35-$50/hr ain’t hard to get if you’re good.


I am still investigating the merits of leasing all my tools & equipment to my corporation. As others have said, having no physical company assets should discourage the legal eagles from attacking. There may be some negative tax issues though.


In regards to defending yourself when you are not at fault. I cannot recall any lawsuit in the past ten years that went the full distance. They were all settled out of court, because it was considerably cheaper than mounting a full scale legal defense. And you can never be sure a jury has even the minimal intelligence necessary to see blatant right from wrong. When I spent 2 weeks in a jury pool, those selected for trials seemed to be the least educated/most easily persuaded folks of the group. The Piper case was beyond bizarre. Those jurors must have been smoking crack.

Perhaps I bashed lawyers a bit too hard, but my sentiments are based on my personal experiences...here’s a few more...

I’ve seen an FBO pay for line service damage they didn’t cause, and I had proof the damage happened elsewhere (steel doesn’t heavily rust overnight in the desert). But when the aircraft owner threatened to sue, the FBO took the path of least expense, and paid for the repair.

Another lawsuit I’m close to concerns a bizjet damaged by a freak storm. No person or manmade object touched the aircraft. Damage/loss of use is estimated at $600,000. Pilot tried to cover his butt by saying he called the FBO and ordered the aircraft be hangared before the storm. Complete BS, but he’s trying to save his job and save his company from paying out. I’m sure it will get settled out of court with the FBO paying for some of the damage.

I have seen shops slowly evolve over the past 20 years to the point they won’t overhaul anything. Landing gear, engines, props, etc., all because of potential liability. Even turbine fuel nozzles that I used to flow check 5 years ago, are now sent out to a specialty shop.


Speaking of aircraft cabinets...

Just got a quote today for replacing a small faux wood door on a refreshment stand (King Air 200). It had a small chip in it, and no self-respecting millionaire would even think of flying in an aircraft in such horrible disrepair...

$5,200.00

I’m sure a local cabinet shop could make an identical one for under $200, but most owners would demand the $5200 one, if you are the one paying for it.

Sounds like you're fortunate enough to not only afford the insurance, but you need it. Were I in the same situation, I'd want it & could affors it. The little shops, tho, are what I see as having the biggest problem. The going a/c shop rent in these parts is $60ish p/h. (Of course, I think the auto guys are bumping $100 p/h.) I mean the 1 man shows, like me, who pretty much works on the locals at their airport with maybe a few outsiders. Mostly SE recips that fly maybe 30 hours a year. It's bad enough you can't even pay rent off it, much less eat & then a bunch of non-knowing folks demand insurance coverage or no work. A friend of mine at another airport was asked a couple of years ago about working on the CAP C172. Say, a $1500 Annual Insp., but before doing it he'd have to have shop insurance. Yeahm sure, $10K in insurance to gross $1500, clear maybe half that. Such a deal. About that cabinet door. I don't suppose the $200 locally made one would be certified would it?
Here's a situation I 'avoided' last week. There was a C182 stopped at the FBO for fuel. The guy came back in & asked if we had a GPU. Well, no, the FBO doesn't but I do, so I said 'no'. Mine's one of those big ol' Hobart tug/GPU's that burns about 10 gallons of fuel just getting to the a/c & starting it. Anyone, usually turbines who I will use it on if I have to, get hit for $100 or more just to plug it in. Bear in mind now, IF there's a glitch & IT fries the electrical system (hey, it CAN happen!), I'm out $5K - $10K on insurance, or whatever it takes to repair it if less than that. (Yes, the C182 was a later 24V system.) Then, he asked about jump starting. I then told him I had no way of doing so without risking my personal vehicles' charging systems & that it would take 2 cars anyway. He went to another hangar where an A&P/IA friend of mine was working on his own a/c (the L-6 I posted a pic of a while back). He does no commercial work & also has no insurance. He brought a battery charger over & charged the battery while the guy ate lunch. OK, so he asked me for a GPU, but come to find out why the battery was weak, the alternator died enroute & he wanted to make it home. Hmm. So, maybe my GPU fried his charging system had I started him? He told me he had a weak battery. Now, last time I checked a 182 Equipment List, the alternator is required for flight. Legally, it's either gotta be operating or requires a Ferry Permit to get home with it inop. Let's say I got tied up in that, the guy crashed & his alternator was found defective & contributed to or even caused the crash. (This guy's insurance, like most, if not all insurance, only covers airworthy airplanes & without a Ferry Permit or operating alternator, it's not airworthy. No insurance coverage now.) Not in the FAA's eyes, but a lawyer's eyes, I'm now out $5K for my $100 to GPU the guy or $60 for charging his battery, but I 'let' him go with an unairworthy airplane. After all, he's just a pilot & I, as a mechanic, should have known better....... Risk of liability makes one think........... A couple of years ago, on a Sunday afternoon, there was a new model C182 landed & the NW fairing came apart. That flimsy ABS they use. 2 big sections were still held on at the axle bolt. I looked at it, told the pilot what it would cost for me to do it properly. It was a rental & he couldn't reach the owner, so I told him HE could just cut what's left & probably be OK. I loaned him my snips, he trimmed the pieces & left. The following day, I got a call from his FSDO, in MEM, IIRC. Come to find out, it was a hard landing, at some point & the firewall was buckled. OK, so what did I have to do with it? The bimbo from the FSDO informed me that I didn't make a logbook entry or revise the W&B/EL for the removal of the fairing. I informed her I didn't touch it. I ended up filling out some statement to that effect & a couple of days later she called me & said the pilot had confirmed my statement & no enforcement action on me would follow! Thanks. No, sometimes it just ain't worth it!