Private Jet Insurance Explained- How Private Jet Insurance Works

Hull insurance covers physical damage to the aircraft itself. If the aircraft is damaged in a ground incident, a weather event, a collision, or is declared a total loss following an accident, the hull policy responds.

Most aviation hull policies are written on an agreed value basis. The aircraft's insured value is agreed between the owner and the insurer at the time the policy is bound. If the aircraft is declared a total loss, the agreed value is paid (less any deductible) without the post-loss negotiation over market value that characterizes most property insurance claims. 

This agreed value structure is important: it means the coverage payout is known in advance, but it also means the insured value must be kept current with market conditions. An aircraft insured at a value set three years ago may be significantly underinsured if market values have risen.

Hull coverage applies differently depending on whether the aircraft is in-flight or on the ground. In-flight coverage typically carries a different deductible than ground-only (moored) coverage. Most comprehensive policies cover both, but the deductibles and exclusions differ. Ground-only policies, which exclude in-flight hull coverage, exist at lower premiums for aircraft that are used infrequently or stored.

Liability coverage protects the aircraft owner or operator against financial claims from third parties. In the context of a charter flight, this means claims from passengers, bystanders, or parties whose property is damaged as a result of an aviation incident.

Liability coverage in aviation is written as a combined single limit, meaning the total available under the policy for all third-party claims arising from a single incident is a single number. A policy with a $50,000,000 combined single limit has that amount available to respond to all claims from a single event, regardless of how many parties are involved.

The minimum liability coverage required of a Part 135 charter operator is set by regulation and is lower than what most sophisticated charter clients would consider adequate. The legal minimum can be as low as $300,000 per passenger seat in some cases. Most reputable charter operators carry significantly higher limits: $50,000,000 to $100,000,000 or more in combined single limit liability is typical for larger aircraft at quality operators. 

High-net-worth charter clients and corporate travel programs should verify the specific liability limits in place on the operator's policy before flying, not assume that any coverage is sufficient coverage.

Smooth limits vs. passenger sublimits: Some liability policies contain a passenger sublimit, which caps the amount available per individual passenger regardless of the overall policy limit. A policy with a $50,000,000 combined single limit but a $1,000,000 per-passenger sublimit may respond very differently to a multi-passenger incident than a smooth limit policy with no per-passenger cap. Ask specifically whether the operator's policy contains passenger sublimits.

When you book a Part 135 charter flight, the operator's hull and liability policy is in force. You are a passenger in an operation that is insured. What the operator's policy may not cover:

• Your personal property and baggage on board
• Trip cancellation or interruption costs if the flight is cancelled for operational reasons
• Medical expenses beyond what the operator's liability coverage provides
• Your personal liability as a charterer if you cause damage to the aircraft

Corporate charterers, family offices, and high-net-worth individuals who charter frequently should discuss with their insurance advisers whether their existing personal liability umbrella, travel insurance, or non-owned aircraft liability policy provides adequate supplemental coverage beyond the operator's baseline policy.

Practical step:  Before any charter flight, request written confirmation of the operator's liability coverage limit. A reputable operator or broker provides this without hesitation. If you cannot obtain it, that is material information about the quality of the operator.

Private jet insurance is built from two primary components. Hull coverage protects the physical aircraft against loss or damage, written on an agreed value basis where the insured value is agreed at policy inception and paid in full (less deductible) on a total loss. Liability coverage protects against financial claims from passengers, bystanders, and property owners arising from an aviation incident, written as a combined single limit available for all claims from a single event. Part 135 charter operators are required to maintain hull and liability insurance as a condition of their operating certificate. The minimum liability limits required by regulation can be substantially lower than what high-net-worth charter clients or corporate programs should consider adequate: most reputable operators carry combined single limits of $50,000,000 or more.

An aircraft owner requires both hull and liability coverage at a minimum. Additional coverage components that are commonly part of a comprehensive private jet policy include:

• Non-owned aircraft liability: Covers the owner's liability exposure when flying in aircraft they do not own, relevant for owners who also fly charter or borrowed aircraft
• Passenger voluntary settlement: Provides a defined benefit to passengers regardless of fault determination, separate from the liability coverage that requires negligence to be established
• War and allied perils: Extends coverage to risks excluded from standard policies, including acts of terrorism, hijacking, and confiscation, relevant for international operations
• In-motion ground coverage: Ensures coverage when the aircraft is taxiing or being repositioned on the ground, where some policies have exclusions

The aviation insurance market in 2026 is characterized by disciplined underwriting. Carriers are selective about risk, pricing reflects the aircraft's use category (private Part 91 vs. Part 135 charter), and accurate declaration of how the aircraft is used is essential. Misclassifying use is one of the most common causes of claim denial in aviation insurance.

When booking a private jet charter, the Part 135 operator's insurance policy is in force and covers the operation. However, the operator's policy does not automatically cover personal baggage, trip cancellation, or the charterer's personal liability. Some operator policies contain passenger sublimits that cap the available coverage per individual passenger below the overall combined single limit, providing less protection in multi-casualty incidents than a smooth limit policy. Charter clients should request written confirmation of the operator's liability coverage limit and specifically ask whether the policy contains passenger sublimits before confirming any booking.

Hogani Jets coordinates each charter through licensed Part 135 operators.

Contact Hogani Jets at charter@hoganijets.com or +1-855-660-0573.

What does private jet insurance cover?

Private jet insurance covers two primary areas: hull coverage protecting the physical aircraft against loss or damage, and liability coverage protecting against third-party claims from passengers, bystanders, and property owners. Additional components may include non-owned aircraft liability, war and allied perils, and passenger voluntary settlement.

Am I covered by insurance when I book a charter flight?

Yes. The Part 135 operator's hull and liability policy covers the operation. However, it may not cover personal baggage, trip cancellation, or your liability as a charterer. Reputable operators carry combined single limits of $50,000,000 or more. Always request written confirmation of the operator's liability limit before flying.

What is hull insurance for a private jet?

Hull insurance covers physical damage to the aircraft, written on an agreed value basis. If the aircraft is declared a total loss, the agreed insured value is paid less the deductible. Coverage applies both in-flight and on the ground, though deductibles differ between the two.

What is combined single limit liability in aviation insurance?

Combined single limit (CSL) is the total available under an aviation liability policy for all third-party claims from a single incident. Some policies include passenger sublimits capping individual payouts below the overall CSL. A smooth limit policy with no sublimit provides stronger protection in multi-casualty incidents.

Does a charter client need their own aviation insurance?

Not always. The operator's policy covers the flight operation and third-party liability. It does not cover personal baggage, trip cancellation, or charterer liability. High-net-worth individuals and corporate travel programs should confirm with their insurance adviser whether supplemental non-owned aircraft or travel coverage is needed.

What is non-owned aircraft liability insurance?

Non-owned aircraft liability covers your liability exposure when flying in aircraft you do not own. It is relevant for frequent charterers, corporate travel programs, and business owners whose employees charter regularly. It fills the gap between the operator's policy and your personal liability exposure as a charterer.

What is agreed value in aviation hull insurance?

Agreed value means the aircraft's insured amount is set between the owner and insurer at policy inception. In a total loss, that agreed amount is paid regardless of market fluctuations at the time of the claim. The agreed value should be reviewed regularly to reflect current aircraft market values.

What is a passenger sublimit in aviation liability insurance?

A passenger sublimit caps the maximum payout per individual passenger below the overall combined single limit. A policy with a $50,000,000 CSL but a $1,000,000 passenger sublimit pays far less per person in a multi-casualty incident than a smooth limit policy. Always confirm whether sublimits exist before booking.

What is war and allied perils coverage in aviation insurance?

War and allied perils coverage extends a standard aviation policy to risks typically excluded, including acts of terrorism, hijacking, confiscation, and hostile detonation. It is particularly relevant for aircraft operating internationally in regions with elevated geopolitical risk. Most standard policies exclude these perils without a specific endorsement.

How much liability insurance does a private jet charter operator need?

FAA regulations set minimum liability thresholds that can be as low as $300,000 per passenger seat for some Part 135 operations. Reputable operators carry combined single limits of $50,000,000 to $100,000,000 or more. Always verify the specific liability limit in force before confirming any charter booking.