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Can You Afford to Self-Insure Business Aircraft Maintenance?

Can You Afford to Self-Insure Business Aircraft Maintenance?

Can You Afford to Self-Insure Business Aircraft Maintenance?

Should you buy a maintenance plan to cover your business aircraft or helicopter? It’s a question operators should ask themselves from time to time. The answer is: it depends.

Fixed-cost maintenance plans are a godsend when something goes wrong with your engines, avionics or critical mechanical and electronic components. These programs can help you avoid expensive surprises, manage your maintenance budget and keep your aircraft in mission-ready condition.

Like similar programs for your house or car, maintenance plans for your aircraft protect you from the unexpected, enable you to proactively predict maintenance costs and spread out the projected cost of repairs over the course of a year.

Self-insurance is another strategy if you’re willing to assume the risk of covering 100 percent of your repair costs on an out-of-pocket basis. Consider this approach only if you know your aircraft very well, keep up with scheduled and preventive maintenance, and have years of maintenance-cost data available for analysis. Then you can do a pretty good job of estimating the annual cost of scheduled and unscheduled events so you can compare projected costs against the fixed cost of a maintenance plan and budget accordingly.

Even if the costs of both options compare favorably, many operators choose to mitigate risk with a maintenance plan, which above all provides peace of mind for owners, operators and directors of maintenance.

What’s important is that you make an informed decision on whether to sign up for a plan and which program to choose. That means doing your homework, starting with determining your needs and risks, and checking out available programs.

Working with our customers, we’ve found that many operators find it difficult to accurately estimate the cost of planned and unplanned events so they can build an adequate maintenance budget. Consider your aircraft’s age, since the needs of older aircraft are significantly different than newer ones. The more you know about your aircraft and the historic cost of maintenance, the better you’ll be able to evaluate the potential savings offered by a plan.

Many plans are available for business aircraft and helicopters. With continuous advancements in aircraft technology, sophistication and reliability, maintenance plan providers are keeping pace by changing programs to meet the needs of today’s operators. For example, Honeywell recently introduced a usage-based element that rewards operators for putting less stress on their propulsion engines.

It’s a good idea to investigate available programs, compare them side-by-side and ask providers for information specific to the aircraft you’re considering enrolling in a maintenance program.

Here are some questions you should ask maintenance plan providers to help you evaluate their specific program:

  • How long have you been providing maintenance plans for business aircraft like mine?
  • What exactly does the program cover?
  • Is an upfront buy-in payment required to join the program?
  • What are the copays and plan limits?
  • What resources are available to prioritize parts and service?
  • What program options or upgrades are available?
  • What statistics can you share on potential savings?

Armed with this information, you’ll be able to evaluate the available programs and determine the best course of action for your particular operation and aircraft. For more information on maintenance plans and to learn more about Honeywell’s full line of offerings, drop us a note on the accompanying form.

Karen Martinez is sales manager  for Honeywell maintenance service plans. Honeywell offers a full range of service plans, covering propulsion engines, avionics, auxiliary power units and mechanical components.

Karen Martinez
OEM Aftermarket Sales Manager
Karen Martinez is an OEM Aftermarket Sales Manager with the MSP Avionics & Mechanical Components team. She originally started working as a Sperry employee in 1979 and has spent time in many areas of the business and has seen the evolution of products and services evolve over the years. She enjoys MSP sales because she sees the value in the programs and knows she is providing solutions to operators globally for their aircraft maintenance needs.

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