Travel Insurance for Private Jet or Yacht Charters: What’s Different?

Private jets, yacht charters, and custom itineraries have reinvented luxury travel in recent years. Soar above the clouds to five-star hotels and experience bespoke experiences with ultimate exclusivity and flexibility. Go on $100,000 safaris and island experiences. However, traditional travel insurance leaves a lot to be desired.

Let’s go over how you can use luxury travel insurance to protect your assets, improve flexibility, and tailor insurance based on your situation.

Understanding Ultra-Luxury Travel Risks

Unique exposures on private jets

Riding private jets exposes you to unique risks. The main one is liability–if someone gets hurt or property is damaged, regular insurance might not cover any expenses. Only specialized jet charter insurance can cover them.

When traveling by private jet, you’ll also be going through smaller airports that lack the same resources as major airports.

Yacht charters and maritime-specific risks

Yachts are vulnerable to storms, piracy, and medical events. If you or your guests may need medical treatment, yachts should have first aid kits on board. Plenty of yachts and superyachts also employ specialized medical personnel.

But what if someone is seriously injured or ill? Medical evacuation services may be necessary if someone’s condition requires it. Travel insurance can help cover medical evacuation at sea.

Search and rescue (SAR) may also be necessary if someone falls overboard or gets lost. It may be considered an additional policy depending on what travel insurance company you use.

Higher financial stakes

Luxury travelers tend to stake plenty of money on deposits, nonrefundable charters, and specialized crew. The “no refunds means NO refunds” clause for many charter flights is frustrating since even if there’s an emergency trip cancellation, you won’t get a refund from the service provider.

Insurance is a great way to protect what you’ve invested in the trip. Luxury travel insurance can reimburse you for up to 100% of nonrefundable, prepaid costs, such as jet and yacht charters.

Key Differences from Standard Travel Insurance

Higher trip values and coverage limits

Luxury travel insurance policies can cover up to $8 million. Standard travel insurance coverage limits range from $10,000 to $250,000.

Higher end travel insurance usually cost around 10% of your total trip value. Be aware that the greater your coverage, the more expensive the trip insurance cost.

Broader cancellation or interruption protection for custom itineraries

If your itinerary gets cancelled or interrupted due to an eligible reason, travel insurance can reimburse you for lodgings, tickets, and other expenses. Luxury travel insurance policies will offer greater trip interruption and cancellation coverage. What is covered will depend on the policy.

Emergency medical evacuation from remote destinations

Yachts and jets can travel to remote destinations that don’t have access to high quality healthcare. Whether that’s to an island resort or a breathtaking castle, medevac services may be necessary.

Evacuation travel insurance can cover from $100,000 to $1,000,000 in medical evacuation and repatriation costs. This typically includes the cost of necessary medical and transportation fees incurred during:

• Air ambulances and helicopters
• Airlifts
• Medical ground transport
• Life support

Provisions for unique valuables on board

A million-dollar insurance policy is very different from a policy that caps at $1,000. After appraisal, jewelry and art can cost hundreds of thousands or even millions of dollars. You don’t want to carry a Rolex uninsured and have it stolen during vacation, just for insurance to refuse to cover it.

Jewelry and ring insurance is useful for travelers who want to show off their gorgeous, high-value accessories with minimal risk.

Before purchasing a travel insurance policy, you should also ask if it will cover newly purchased jewelry. Many travelers enjoy buying new collectibles when abroad.

Exclusions that could surprise luxury travelers

Normal travel insurance policies have a lot of exclusions that can be shocking for luxury travelers. To properly mitigate risk, it’s better for those chartering jets or yachts to obtain specialized insurance.

Types of Coverage to Look For

Trip cancellation and interruption with expanded limits

Trip cancellation insurance is for covering prepaid, nonrefundable expenses if your trip gets cancelled. Make sure that your travel cancellation insurance covers your private jet or yacht charter before purchase. Common reasons include:

• Family medical emergency
• Death or hospitalization
• Jury duty/legal proceedings
• Mandatory work presence
• Terrorism

Trip interruption insurance is different from trip cancellation insurance. This type of trip delay insurance covers expenses that you might incur if your trip gets delayed or cut short, such as meals and hotel costs. Eligible reasons include:

• Injury or illness mid-trip
• Inclement weather
• Transportation delays
• Natural disasters
• Strikes
• Lost passport and documents

Buying a comprehensive travel insurance policy will usually get you both trip cancellation and interruption insurance.

Enhanced evacuation and repatriation

Basic evacuation insurance will cover medevac situations. However, it may not cover evacuation due to civil unrest or mandated evacuation situations.

It’s a good idea to tailor evacuation insurance based on your travel plans. For example, if you’re going on a safari, make sure the medevac insurance covers emergency safari evacuations.

Repatriation insurance is another point of coverage to consider if you have loved ones or dependents. It covers the cost of repatriation of remains in case the policyholder passes away on the trip. Life insurance sometimes covers repatriation if you’ve added it as a rider or add-on.

Charter deposit insurance

Charter deposit insurance is useful if you don’t want to worry about losing all of your deposit amount in case of a trip cancellation.

Crew liability coverage

Yacht crew insurance covers crew liability concerns. A crew liability policy can cover liabilities that arise from:

• Crew member injury or death
• Medical expenses
• Funeral and repatriation
• Legal fees for the liability case
• Absent crew

Crew liability insurance does not cover everything. For example, it excludes damages that come from the policyholder’s wilful misconduct or fraud. Always read the contract carefully so you know what is covered, since liability lawsuits often cost millions.

Personal effects and high-value items coverage

Normal baggage insurance usually caps at $2,000-$3,000. If you carry or wear high-value items, you should upgrade to top-tier travel insurance for coverage that suits what you’re bringing with you.

Kidnap & ransom insurance for high-profile travelers

If you’re a high-profile traveler who is famous or wealthy, kidnap & ransom insurance can provide useful financial protection. It’s common for politicians, celebrities, ultra-high net worth individuals, business people, and journalists. These groups of people are frequent kidnap-for-ransom targets. Many companies will purchase kidnap and ransom insurance for their employees so if the kidnapped worker files a lawsuit, the employer will be covered for damages.

K&R insurance can cover:

• Ransom payments
• Extortion
• Public relations expenses
• Crisis management
• Medical care
• Bank loan interest
• Loss of income
• Support services
• Business interruption

K&R insurance is also more useful if you’re traveling to an area with a high rate of kidnapping and crime. Chartering a yacht or private jet could make you a greater target.

Working with Insurers and Brokers

Why standard policies fall short

Traditional travel insurance is meant to balance affordability with coverage. It’s for the average traveler who has substantially lower personal liability risk. The standard travel insurance policy has a medical maximum of $100,000 and only $10,000 for trip cancellation fees. Baggage coverage is only around $1,000. These coverage limits are not enough for luxury charters where even the deposit can cost more than that.

The benefits of specialized insurance brokers for private aviation and luxury yachting

Save valuable time with the help of a broker. Private aviation and superyachts can lead to great financial loss. A specialized insurance agent can help you curate a policy dedicated to protecting you and your assets.

Questions to ask when arranging ultra-luxury travel coverage

Luxury travel insurance policies aren’t one-size-fits-all. It’s important to ask key questions, such as:

• How is the trip value determined?
• What happens if the yacht or jet gets grounded?
• What is excluded from coverage?
• What situations void coverage?

Regulatory and Legal Considerations

Maritime laws and their insurance impact

Interestingly, marine insurance is the oldest known type of insurance. Maritime laws have complicated how insurers need to deal with liabilities and policies. What happens if your yacht passes through international waters, and how does that affect your yacht insurance? What happens if your yacht gets damaged and salvage operations commence, triggering extra expenses?

Not all insurance companies are willing to or capable of tailoring yacht insurance for foreign legal considerations. Standard travel insurance typically excludes wreck removal and other maritime costs. Comprehensive yacht insurance, however, will take into account the cost of:

• Yacht removal and towing
• Salvage operations
• Hull and liability insurance
• Higher coverage limits
• Dispute and litigation costs

It’s a good idea to obtain yacht liability insurance from a company that specializes in providing comprehensive yacht insurance for luxury travelers.

Private jet flight regulation differences

Private aviation is subject to different regulations from commercial aviation. Commercial aviation has stricter regulations. Still, failing to comply with private jet regulations can lead to fines and safety concerns.

Importance of verifying operator licenses and insurance certificates

When chartering a jet or yacht, make sure to verify all official licenses and insurance certificates. Failing to be properly licensed can cause serious legal and financial issues in the event of an emergency.

Best Practices for Travelers

Documenting valuables

You and any guests you’re hosting should document valuables before setting off on the trip. Knowing what valuables could be lost, damaged, or stolen makes it easier to file travel insurance claims later on.

Reviewing charter contracts for cancellation clauses

Charter contracts should have a cancellation clause, AKA a termination clause. It will outline what conditions allow for an early termination of the contract (either unilateral or mutual).

Staying updated on weather or security alerts

Travelers should sign up for local security alerts for their destination or any countries they may pass by en route. Weather and safety apps can notify you if there is a security concern, such as an impending hurricane or geopolitical tensions. While private aviators should get NOTAM (Notice to Airmen) alerts, you never know what might happen. Staying updated and keeping in touch with weather apps and embassies could save you a lot of trouble.

Consider add-ons

Many travel insurance add-ons are useful since they provide additional coverage, bridging gaps in your policy. So what are the best travel insurance add-ons?

CFAR insurance: You can Cancel For Any Reason and get your prepaid, nonrefundable expenses reimbursed. This provides immense flexibility, though it may require you to cancel within 24 hours of departure

Adventure sports insurance: If your jet or yacht brings you to adventure sports, such as skiing or skydiving, you will need an adventure sports add-on. Otherwise, your travel medical insurance won’t cover injuries or illnesses that arise from higher risk activities.

Final Takeaways

Renting a yacht or jet comes with liability and financial risks. Regular travel insurance won’t be enough to cover liability and evacuation concerns for chartered boats or flights. Travelers should consider customized travel insurance for ultra-luxury trips.

Working with an experienced broker is essential to avoid gaps in coverage. Check out the best travel insurance for private jet and yacht charters to invest in the right trip protection today.