The government plans to make hull insurance optional for trainer aircraft – a move that will lower operating expenses of pilot training schools.
The move follows a demand by the schools in the wake of a steep increase in insurance premia over the past few years. The hikes came about following a spate of accidents involving trainer aircraft.
Currently, Directorate General of Civil Aviation (DGCA) norms make it mandatory for pilot training schools to obtain an insurance policy that covers hull loss. Schools also take insurance cover for instructors, trainees and for third party liability.
The DGCA is expected to invite public comments soon on the proposed amendment.
Lower training costs
The Association of Flight Training Organisations (AFTO) has welcomed the DGCA’s move. AFTO president HVP Singh said this will benefit flying training schools who own aircraft. Schools which have taken aircraft on lease would have to take full insurance cover based on lease terms.
The schools can create a capital fund to self-finance their losses in an event of aircraft damage, or could earn interest on the saved capital. Singh believes that making hull insurance optional would lower the cost of flying training and thus encourage more students to train in India.
DGCA issued 1,342 commercial pilot licences (CPL) in 2024 – down from 17 per cent the previous year. The figure includes certification of locally-trained cadets and licence conversion of those who trained overseas.
The big bottleneck in pilot training in India has been a shortage of flight instructors. Along with recommending steps to ease availability of instructors or speeding up licensing, the industry has also been demanding changes in insurance policies.
Last year, AFTO wrote to the civil aviation ministry to highlight aircraft insurance challenges. While globally premia account for 1-2 per cent of the hull value, these had increased to upto 40 per cent for certain trainer aircraft in India. The association complained about delays in claim settlements and alleged that companies were refusing to insure legacy aircraft. The air worthiness of the aircraft should be the sole consideration for insurance and not its age, the association had said.
Licensing, other needs
In India, there are around 38 flying training schools with a combined fleet of around 250 planes. Around 60-70 per cent of the fleet comprises 20-40 year old Cessna aircraft. According to industry insiders, a new Cessna 172 costs around ₹4-5 crore and Diamond DA-40 costs upwards of ₹5.5 crore.
“The removal of mandatory hull insurance by DGCA is a positive step and will help reduce losses of pilot training schools. Besides expensive spare parts with forex appreciation and high fuel costs, the industry has to bear costs due to delays in securing RBI approval, import & certification of aircraft.
Even the certification process of instructors can take about 3-9 months. We can easily achieve economies of scale and speed up training if we implement the DGCA’s published standards of service and cut down time taken for the approvals,” said Hemanth DP, CEO of Asia Pacific Flight Training Academy.
On its part, the DGCA is introducing steps to make it easier for students to study and obtain CPL in India. One step under consideration is removal of the Class XII physics and mathematics requirement to obtain a CPL. Licences are now being issued in a digital format replacing the traditional physical copies.
According to Civil Aviation Minister Ram Mohan Naidu Kinjarapu, India will need around 20,000 pilots in the near future due to the unprecedented growth in the aviation sector. The Minister said the government is leveraging technological solutions to streamline licensing and aviation operations.