President’s Perspective - 2003/07
Dave Brown, AMA President
They all died doing what they loved—flying.
This past month included some of the most nervous days I can remember as president of AMA. We were close to the wire getting a quote for our insurance program. In the end, we got a quote from an insurer that was better than the renewal quote offered by our former company, Royal, and we changed insurance companies. This change saved us some money compared to the renewal quote from Royal, but it still didn’t keep the premium from going up 70 percent compared to last year.
Although this was considerably more than we had budgeted for this premium, the budget has just about enough room to accommodate this amount. It will put us close to a losing year in terms of dollars, but we should be able to balance the budget. The main variable is what claims we will have in the near term; the self-insured part of the claims can be the difference between a good year and a negative one. That is up to the membership and its efforts to reduce claims.
Given the fact that a substantial percentage of our claims comes from incidents or accidents that have little to do with aeromodeling, it would be in our best interest to look for any safety hazards around our flying sites and remove them.
It would also be a good idea to review your club bylaws, and be sure you abide by them to avoid legal actions against the club. Nowhere is this any more important than in areas involving disciplining or removing a club member. Newsletter editors need to be particularly sensitive to anything that could be construed as slander or libel.
The ball is in our court, and our ability—or inability—to avoid claims will determine whether any dues increases are necessary in the near future.
Charter club renewal went to the last minute, and in doing so left many members of your Executive Council with a few more gray hairs—or maybe a few less hairs. It also left a few clubs in a panic, as the club charter certificates and certificates of insurance could not be processed until we had the insurance policy number(s).
The nature of the insurance industry leaves us in a quandary. It seems that the standard way to do business is to wait until the last minute to provide quotations or commitments to insure. Most policies—and ours is no exception—have a 90-day notice of nonrenewal, but that is just a formality. Receiving a notice doesn’t mean that the company will not renew insurance coverage, but that it might not and wants to reserve the right to drop your coverage. Royal has given us this notice for at least the last two years, yet it did provide a quotation.
I realize that the membership would want us to "put the insurance out to bid," as suggested by many members who think doing so is a panacea. Members also want AMA to renew the club charters and insurance certificates before they expire. This is a predicament. The quote we accepted this year came in a couple of hours before our conference call to make a decision. That conference call was scheduled at the last possible moment to still allow us to produce the charter club certificates before they expired. It became a waiting game, and one with a lot at stake.
Wait until the last minute for the best possible quote, or grab the first quote you get, regardless of the price, to provide certificates earlier? Neither option is very appetizing.
We were able to obtain a policy that duplicated the coverage we have had for the past number of years, but it wasn’t our only option. A couple of quotes were for lesser coverage, dropping the coverage down to $1 million instead of the current $2.5 million, which would have been only a small increase over last year’s premium. We will have to consider this as an option for the future.
A $1 million policy would cover any claim we have settled in the past, and it would allow some reduction in policy premium, as well as more potential sources of coverage. It would not reduce the amount we pay out in the SIR (self-insured retention) portion of each claim—AMA pays the first $250,000 of each claim—so the savings would be limited. The main effect would be to reduce the likelihood of the "deep pockets" claims, where the claim just "happens" to be for the total amount of insurance coverage available.
It could also be more feasible for AMA to go into a fully funded program (a form of self-insurance), which would preclude the last-minute tension. As you see, we have a lot to consider and are looking into as many options as we can to continue to provide you with coverage.
Recommendations and Considerations
- Inspect flying sites for non-aeromodeling hazards and remove them.
- Review and follow club bylaws carefully, especially procedures for disciplining or removing members.
- Newsletter editors should avoid language that could be construed as slander or libel.
- Consider future insurance options:
- Maintain current coverage levels ($2.5 million) and accept higher premiums.
- Move to lower coverage ($1 million) to reduce premiums and increase insurer options.
- Explore fully funded/self-insured programs to avoid last-minute market issues.
Letter from Barent N. McCool
A couple of months back I wrote about the Columbia tragedy, and pointed out that a couple of the astronauts had mentioned aeromodeling in preflight interviews. Afterward I received the following e-mail from Barent N. McCool that speaks for itself. To say that I got a lump in my throat when I read it is an understatement.
"I just received my May 2003 copy of Model Aviation and was pleased to read your 'President's Perspective' on the Columbia astronauts and the space program.
"My son, Cmdr. Willie McCool, was the pilot of the Columbia, and one of the astronauts that you referred to as being interested in model airplanes and I thought I'd drop you a brief message on just what modeling meant to the McCools.
"I started building models when I was five years old, with the 10-cent Comet wooden models, and as a thirty-year member of AMA I am still flying R/C today here in Las Vegas.
"Willie became interested in flying models in 1971 when I introduced him to Control Line models with the Cox PT-19. We flew it until it was no longer airworthy and graduated to the Carl Goldberg Buster and Shoestring stunt with old Fox .35s. Willie and the 'Old Man' spent many wonderful hours building, repairing, and sometimes even flying models together. It is true even today, 'the family that plays together stays together.'
"This past December Willie and I came 'full circle' with modeling. He had called and asked if I still had any of the old Control Line models and I sent him a small 'new' O.S. Max .35. I was looking for a CG Shoestring to send him when I saw a new Cox PT-19. I sent the PT-19 to him and Willie introduced the joy and thrill of model flying to his youngest son, Cameron.
"In between the mission prep for STS-107 and crew training, Willie found time to take his son out to fly and wrote to me that he had the feeling he had gone back into time. He told me that he felt the day he and I had flown together in Control Line was the reason he loved to fly."
Transcribed from original scans by AI. Minor OCR errors may remain.
