A record 1562 commercial pilot licences (CPL) were issued by the Directorate General of Civil Aviation in 2023.

Pilot training schools in the country, however, are not celebrating. Instead the schools are worried about an uncertain future due to a steep hike in insurance premiums and onerous policy conditions.

The Association of Flying Training Organisation (AFTO), on Friday, petitioned the civil aviation ministry for help as high premiums will result in an increase in student fees and push aspiring pilots to train overseas

In 2022, 1135 commercial pilot licences were issued by the Directorate General of Civil Aviation (DGCA). This includes both certification of locally trained cadets and licence conversion of those who trained overseas. The number of licences issued has now increased to over 1500.

Patchy safety records

But pilot training in India has also been marred by patchy safety records. There has been a spate of accidents involving trainer aircraft. In October, the DGCA suspended approval of Redbird Flight Training Academy following five accidents to its aircraft in six months. This has led to an increase in premiums and left the industry worried.

“Globally, the insurance premiums are in the range of 1.5 to 3 per cent of the hull value of the aircraft. Previously, this was the case in India too but over the past 2 to 3 years, the premium has been increased by almost 500 per cent being attributed to the increase in the number of accidents of trainer aircraft in India. However, this premium increase has been uniformly applied to all Indian trainer aircraft rather than being applied only for those flying training organisations where the average accident rates are high, “ AFTO president Harsh Vardhan Pratap Singh said.

AFTO has 14 flying schools (of the total 34) as its members. The number of trainer aircraft in India across all schools is said to be around 220. Depending upon age and type, trainer aircraft have insured values of ₹50 lakh to ₹14 crore.

Flying schools also complain that a public sector insurer has made policy renewal conditions stiff. The insurer now requires assistant flight instructors to have minimum flying experience of 500 hours which is far higher than the eligibility criteria set by the DGCA. “ This norm will kill the aviation industry. Already there is a shortage of instructors. Now no pilot will be interested to become an instructor,” said Jati Dhillon, managing director of Government Aviation Training Institute, Odisha. 

Also, insurers should consider the airworthiness of an aircraft and not refuse insurance merely because an aircraft is old.

“DGCA is the sole regulator for civil aviation and frames all training and safety regulations and standards in the country. Insurance companies also must follow the same regulatory rules and norms,” added Hemanth DP, CEO of Asia Pacific Flight Training Academy. 

businessline reached out to public and private insurers but did not receive a comment on the issue.

High-risk category

However people aware of the sector said, flying school aircraft insurance has traditionally been loss-making for insurers. 

“Although this was always a high-risk category, as the losses have increased, the reinsurance markets have reduced their capacity and increased the treaty rates; thereby impacting the premiums charged,” a sector expert said.

Insurers consider factors like aircraft airworthiness, age, maintenance standard, availability of spares, liability issues, aeronautical experience of the pilot among others while fixing premium rates. “ The purpose is to minimise losses and ultimately help customers,” the expert said.

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