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by Aric Peters on February 18 2026
Aviation is one of the most technologically advanced industries in the world. Jets now fly themselves for most of a trip, SATCOM tracks every movement, and predictive maintenance can detect a failing part before a pilot ever hears a strange noise.
Yet the aviation insurance industry still operates like it’s 1985.
Aviation insurance is one of the most outdated corners of the global financial system. It is slow, opaque, relationship-driven, and resistant to innovation. While airlines, manufacturers, and operators embrace data, automation, and real-time monitoring, aviation insurers often still rely on fax-era workflows, manual underwriting, and gut instinct. The gap between what aviation is capable of and how aviation risk is insured has never been wider.
A Relationship-Centered Business in a Data-Driven World
At its core, aviation insurance is still run like an exclusive private club. Deals are placed through a small group of brokers and underwriters concentrated in London, New York, and a few other hubs. Premiums are often based less on real-time operational data and more on who you know and which firm holds the relationship.
In most modern insurance lines, like life, property, and auto, pricing is driven by data models. Aviation, despite producing enormous volumes of flight data, barely uses it. Insurers often underwrite an aircraft with less information than a rideshare company uses to price a 10-minute trip.
A $40 million business jet may be quoted using pilot history forms, limited maintenance summaries, and a general safety reputation, all while ignoring thousands of hours of flight data showing exactly how that aircraft is flown.
Decades Behind in Technology
Modern aircraft are flying data centers. Every flight records speed, altitude, control inputs, weather conditions, engine performance, and pilot responses. The data exists in abundance, but aviation insurers rarely put it to work.
Claims still arrive via email chains, PDFs, and scanned forms. Adjusters manually review logs and photos. Underwriters rely heavily on spreadsheets. Policy changes can require weeks of calls and negotiation. The process is slow, expensive, and full of friction.
Other industries have moved to automated underwriting, instant policy issuance, dynamic pricing, and AI-assisted claims. Aviation insurance largely has not.
Misaligned Incentives
The aviation insurance market is not structured to innovate. A small number of insurers dominate the space, protected by high barriers to entry and long-standing broker relationships. With limited competition and high switching costs, there is little pressure to modernize.
Insurers are often rewarded for conservatism rather than precision. It is safer to overprice risk than to model it accurately and disrupt the status quo. The result is a system where disciplined operators subsidize less disciplined ones because risk is not measured in a granular, data-driven way.
The Cost of Staying Stuck
Stagnation is not harmless. It increases costs across the industry. Operators pay premiums that may not reflect their true risk profile. New entrants struggle to secure affordable coverage. Innovation in electric aircraft, autonomy, advanced air mobility, and manufacturing moves faster than insurance can adapt.
When insurers cannot confidently model risk, they either decline coverage or charge premiums high enough to slow progress.
Enter Virtus Aviation
This gap will not exist forever. New platforms, underwriting models, and approaches are emerging.
At Virtus, we believe modernization starts with industry specialization. The only way to structure aviation risk properly is to understand aviation.
I’ve spent 25 years in this industry, spanning aircraft operations, FAA certification, and global aviation programs, and I’ve seen firsthand how much aviation has evolved. I’ve also seen how slow the insurance side has been to adapt. That’s why I’m excited to be part of building something different at Virtus Aviation. There’s a real opportunity to modernize how risk is understood and structured, and to bring insurance closer to the sophistication of the industry it supports. I believe aviation deserves that level of precision, and I’m proud to help push it forward.
