Pilot loss of license insurance

On March 24, 2015, the first officer of Germanwings flight 9525 flew the Airbus into a mountainside in the French Alps. The French BEA investigation showed he suffered from serious mental illness that he hid from his employer, and raised an awkward question for the whole profession: what does a pilot lose by declaring an illness? The license, at least for a while, and with it a career for which the pilot often paid training on credit. Loss of license insurance answers that exposure. It pays a lump sum, sometimes an annuity, when the pilot permanently loses the Class 1 medical certificate required for commercial air transport and professional licenses. Cover usually triggers after a period of continuous unfitness set in the contract, often twelve months, or as soon as the authority finds permanent unfitness. The sum is a multiple of salary and decreases with age until it lapses toward the end of a career. It is rarely bought alone: pilot unions and some airlines negotiate group contracts, sometimes required by the collective agreement, which pools a risk underwriters cannot price well pilot by pilot. The sensitive point is the mental health exclusion, long common or limited to a reduced benefit. After Germanwings, a 2018 European regulation required operators to run peer support programs. The debate then moved toward insurance: a pilot who knows the loss of income will be covered is more willing to declare. Group contracts were therefore reviewed on that point. Not to be confused with standard group disability cover, which pays for inability to work in general. Here the trigger is loss of the license, and a pilot still fit for a ground job is paid.