Here is a summary of the program highlights we are discussing with Hallmark and other carriers.
- The PRA must establish a formal, recurrent ground & flight training program. I would like to leave it up to the PRA to establish what, exactly, the program consists of, but allow Hallmark to review and accept/reject this program before we proceed. This program needs to be geared toward enhancing pilot proficiency and reducing losses. Hallmark recommends that training consists of not less than 3-4 hours of ground school and 3-4 hours of flight instruction per year. Part of this can be done with PRA's new Flight Simulator. If the PRA believes this is too much, I’m willing to hear their proposal. If they think more training is best, Hallmark will support that.
- Annual recurrent training must be given by a CFI approved by the PRA. We would like PRA to give us an outline of their requirements for CFI approval. We would also like the PRA to maintain a list of those approved CFIs. Hallmark would like to be given a list of approved PRA instructors and if we agree to go forward with the discounts, we will need the CFI list updated periodically (If the list was available on a website that would be even better).
- The PRA must establish a way to provide a PRA approved aircraft inspection that can be accomplished annually (if this is not practical, we can consider a bi-annual inspection). The goal of this inspection should be to determine that the aircraft meets PRA safety standards and recommendations.
- The PRA must establish a method of certifying that the training and inspections have been completed. The best option is to provide a physical certificate (one for training, one for inspection) that the aircraft owner can submit to Hallmark through their insurance agent. Alternatively, the PRA may submit this directly to the insurance agent. If the PRA has a better solution, Hallmark will consider it.
We have seen this type of program dramatically reduce losses for other aircraft and I believe that doing this will enable Hallmark to offer reduced premiums for those PRA members that complete the program annually.
If I am authorized to proceed with the discount program I would propose that we start with a 30% premium discount for qualifying pilots/members. But here’s the catch: Our rates on autogyros are pretty high. Our hull rates run about 8% for very well qualified pilots up to about 12% for very low time pilots. Even with a 30% discount, you’re still looking at 5.5% to 8.5% hull rates – which I imagine is probably higher than the PRA members want to pay – especially if they are going to the extra effort of getting training and inspections done. I will look into the possibility of a larger discount – but until the aviation management changeover has taken place I’m not able to commit to anything.
Let me know that the PRA folks think of the requirements on their end – if they like it then let’s circle back in a few weeks so I can let you know the status on Hallmark’s end.
The rest of the PRA story = Another 20% discount will be possible by only insuring and paying for 50% of the actual haul value to the carrier. And PRA donating the other 50% to anyone in the group who has an accident, up to the amount in our savings account.
How this works is by using PRA's group Insurance savings account held in trust for members in the group. Each member will donate $500 to $1,000 the first year to be put into PRA savings account to get it started.
In the event of a crash, PRA as a charity will donate 1/2 of the insured haul value, out of savings, to the member and the insurance company will pay the other 1/2 of the claim for 100% coverage.
The 2nd year members do not pay/donate the $500 to $1,000 seed money to our group's savings account.
Members, the 2nd year, only pay back what we spent in the past year divided by the number of members in the group.
If we paid Zero we pay zero in that year. If PRA paid out $50,000 and we have 500 members in the group we have to pay $100 that year.
With PRA's real training program, we should eliminate most claims.
The larger the group the less we all pay and the safer our community will be and rates will go down, by market forces, with real experience.