Airport Liability Insurance: Complete Guide for Operators
Protect your airport, FBO, or aviation facility with comprehensive liability coverage. From premises liability to hangarkeepers insurance.
Key Takeaways
- Airport liability insurance combines premises, products, and aviation-specific coverages
- Hangarkeepers coverage protects aircraft in your care, custody, or control
- Fuel farm operations create significant environmental liability exposure
- Municipal airports often need specialized public entity coverage
- FBOs require tailored programs addressing multiple service lines
What is Airport Liability Insurance?
Airport liability insurance is a specialized package of coverages designed to protect airport owners, operators, and service providers against the unique risks of running aviation facilities. These risks combine traditional premises liability exposures with aviation-specific hazards.
Unlike standard commercial general liability (CGL) policies, which typically exclude aviation risks, airport liability programs are underwritten by aviation insurance specialists who understand the unique exposures of airport operations.
Key Coverage Components
- Premises liability: Injuries to visitors and passengers
- Hangarkeepers legal liability: Aircraft in your care
- Products and completed operations: Services provided
- Fuel farm liability: Fueling operations and storage
- Airport property: Buildings, equipment, infrastructure
- Professional liability: Management and advisory services
Who Needs Airport Liability Coverage?
Airport Authorities and Owners
- Municipal and county airports
- State-owned airports
- Private airport owners
- Airport management companies
Fixed Base Operators (FBOs)
- Fueling service providers
- Aircraft maintenance facilities
- Hangar rental operations
- Flight training schools
- Charter operators
- Aircraft sales and leasing
Airport Service Providers
- Ground handling companies
- Catering services
- Security companies
- Maintenance, repair, and overhaul (MRO) facilities
- Avionics shops
Specialized Operations
- Flight schools and academies
- Air ambulance operators
- Agricultural aviation services
- Aerial survey and photography
Premises Liability Coverage
The foundation of airport liability insurance, premises coverage protects against claims arising from conditions on your property:
Covered Exposures
- Slip and fall accidents in terminals and hangars
- Vehicle accidents on airport property
- Injuries on ramps and aprons
- Passenger injuries during ground transportation
- Security-related incidents
- Food service liability
Unique Airport Considerations
- Jet blast and prop wash injuries
- FOD (foreign object debris) damage
- Runway incursions
- Wildlife strikes near facilities
Airside areas (ramps, taxiways, runways) create unique exposures not found in standard premises policies. Aviation-specific coverage is essential for proper protection.
Hangarkeepers Legal Liability
This critical coverage protects against damage to aircraft in your care:
What's Covered
- Aircraft stored in your hangars
- Aircraft on your ramp or tie-downs
- Aircraft undergoing maintenance
- Aircraft being fueled
- Aircraft being moved or towed
Coverage Options
- Legal liability basis: Only pays if you are legally liable
- Direct damage basis: Pays regardless of fault (broader)
Common Claim Scenarios
- Hangar door strikes aircraft
- Tow bar damage during ground handling
- Fire or weather damage while in storage
- Fuel contamination
- Maintenance errors causing damage
- Theft from secured hangar
| Coverage Basis | When It Pays | Premium |
|---|---|---|
| Legal Liability | Only if negligent | Lower |
| Direct Damage | Any covered cause | Higher |
Products and Completed Operations
Covers liability arising from services and products after they leave your control:
Maintenance and Repair
- Errors in aircraft maintenance
- Parts incorrectly installed
- Inspections negligently performed
- Modifications causing damage
Fueling Services
- Fuel contamination
- Wrong fuel type provided
- Fuel spills causing damage
Other Services
- Flight training deficiencies
- Avionics installation errors
- Aircraft sales misrepresentations
Fuel Farm Liability
Fuel storage and distribution creates significant environmental and liability exposures:
Key Exposures
- Underground storage tank leaks
- Above-ground tank failures
- Pipeline ruptures
- Fuel spills during delivery
- Contamination of groundwater
- Fire and explosion risks
Coverage Components
- Pollution liability: Environmental cleanup costs
- Third-party claims: Damage to neighboring properties
- Regulatory defense: EPA and state enforcement actions
- Business interruption: Loss of income during cleanup
Risk Management
- Regular tank inspections and testing
- Proper secondary containment
- Spill prevention and response plans
- Staff training and certification
Airport Property Coverage
Protecting the physical assets of airport operations:
Covered Property
- Terminal buildings
- Hangars and maintenance facilities
- Control towers
- Fuel storage facilities
- Navigation aids and lighting
- Ground support equipment
- Runways, taxiways, aprons
Special Considerations
- Business income coverage for airport closures
- Extra expense to maintain operations
- Equipment breakdown coverage
- Debris removal costs
Professional Liability
For airport management and consulting services:
Covered Services
- Airport management and consulting
- Flight school instruction
- Aircraft appraisal services
- Maintenance planning and management
Directors and Officers Liability
For airport authority board members and executives:
- Management decisions and oversight
- Employment practices
- Fiduciary duties
Common Airport Liability Claims
Premises Claims
- Passenger slips on wet terminal floor: $75,000
- Vehicle strikes pedestrian on access road: $500,000
- Jet blast injuries ramp worker: $1.2 million
Hangarkeepers Claims
- Hangar fire destroys stored aircraft: $2 million
- Tow bar punctures aircraft skin: $15,000
- Wind blows hangar door into aircraft: $50,000
Products/Operations Claims
- Contaminated fuel damages engine: $300,000
- Maintenance error causes accident: $5 million+
- Wrong fuel type causes engine failure: $150,000
Frequently Asked Questions
Does a standard CGL policy cover airport operations?
No. Standard commercial general liability policies contain aviation exclusions that preclude coverage for most airport activities. You need a specialized aviation/airport liability policy.
What limits should an FBO carry?
Minimum limits of $1 million per occurrence are common, but many FBOs carry $5-10 million or higher. Fuel operations, maintenance services, and flight training typically require higher limits.
Is my airport liable if a tenant causes damage?
Potentially yes, depending on lease terms and circumstances. Requiring tenants to carry adequate insurance and naming the airport as additional insured is essential risk management.
Do we need separate pollution coverage for fuel operations?
Usually yes. Standard liability policies have pollution exclusions. A separate environmental/pollution liability policy is typically needed for fuel storage and dispensing operations.
What about drone operations at the airport?
Drone operations create unique exposures. Both airport operators and drone operators should have appropriate coverage. Airport policies may need endorsement to address drone-related risks.
Need Airport Liability Insurance?
Our advisors specialize in aviation facility coverage for airports, FBOs, and aviation service providers.