Flying Private: Liability and Coverage for Fractional Owners and Jet Card Members

With more individuals flying private than ever, these arrangements offer unmatched convenience, but also significant liability risks. Here’s what you need to know to protect yourself, your family, and your assets.

Flying private and jet club membership are on the rise.

Fractional flying and private jet programs are on the rise. North American fractional operators logged more than 578,000 departures in 2024, surpassing corporate flight departments and charter operators for the first time. That’s a 63% jump over the last five years. Globally, the fractional ownership market is on track to hit $18.2 billion by 2033, fueled by growing demand from high-net-worth travelers looking for flexible private aviation options.

Risks in fractional aircraft ownership

Private and fractional aircraft ownership offers an exceptional travel experience, but it also brings high levels of exposure. These aircraft are constantly in use worldwide and can be jointly owned by 16 or more entities. Fractional owner do not typically know who is flying on the aircraft or how many passengers are onboard.

To further complicate matters, none of the fractional owners carry or own the insurance policy covering the aircraft, and therefore have little to no control over the limits or breadth of coverage that the policy provides. However, even though fractional owners do not have operational control over the aircraft, they are still exposed each minute the aircraft is in use by the fleet manager. Owners can be held liable when a loss occurs — even if they were not aware their aircraft was operating.

Because aviation claims are costly and involve multiple parties, a standard aviation owner’s policy may not suffice. When limits are diluted and exhausted before a claim is settled, you as the fractional owner could be left fully exposed.

Why do high-net-worth fractional aircraft owners and private jet members need non-owned aircraft insurance?

Many people in fractional aircraft ownership arrangements falsely assume that private jet membership programs and the fleet manager’s insurance fully cover these kinds of incidents. However, without sufficient additional coverage, many fractional owners and private jet members are surprised to find themselves exposed to complicated lawsuits and having to settle these incidents out-of-pocket, with some claims adding up to millions of dollars.

Although air travel fatalities and accidents are statistically rare, the number of total dollars paid in aviation claims continues to rise. Catastrophic loss settlements and repair delays push average claim costs into the millions. Specific to fractional ownership and private membership programs, common risks include:

• Ground collisions and accidents during movement and storage by fixed base operators
• Third-party slips and falls
• Pilot error
• Guest negligence
• Catastrophic loss settlements
• Supply chain issues for repairs

Relying solely on fleet coverage can leave owners exposed, especially as claims costs rise. With jet card memberships projected to hit $12.97 billion by 2033 and 93% of individuals who can afford private aviation still untapped, the exposure landscape is only growing.

Exposure areas for fractional aircraft owners and private jet membership program members

Beyond these operational risks, fractional owners and jet membership members face additional exposures that are often overlooked:

Leaseback liability exposure

Since the individual fractional owner is named on the registration of a specific aircraft, and since they have essentially agreed to “lease back” the aircraft to the fractional operator, the individual owner does not carry the policy on the aircraft but does maintain the liability associated with its ownership.

Further, since it is common to see 16 owners (or more) named on each aircraft, any insurance coverage for future claims or litigation associated with the ownership or operation of that aircraft must be split among the operator and each of the owners individually.

Products liability exposure

Because fractional owners are part of “the stream of commerce,” they may face product liability for defects from manufacturing or maintenance when the aircraft is sold.

There is no way for the individual owner to ensure that their “tail” exposure for product liability for the sale of the aircraft is covered after they leave the program, since the operator controls the insurance policies at the time of and after the sale. In other words, this exposure could come back to the individual fractional owner at any time.

Breadth of fractional ownership exposure

Because fractional fleets serve many owners, operators can’t always provide a program aircraft when you need one. In those cases, they often outsource the charter to a third-party operator. Since owners typically have no visibility into these arrangements, coverage must extend to meet this need. Some considerations to keep in mind include:

• Multiple outsourcing layers: It’s not uncommon for a third-party operator to outsource the charter to another fourth- or even fifth-party operator, sometimes involving brokers rather than actual operators
• Leased-back aircraft exposure: The owned aircraft is “leased back” to the fractional operator, leaving the individual owner with no operational control but full exposure  — even if unaware their aircraft is flying, owners can still face claims in the event of a loss
• Non-owned liability needs: Owners rarely fly on their own aircraft, they typically request an aircraft from the fractional operator, which means they need a non-owned provision in their primary policy or an added non-owned liability policy

Together, these factors highlight the complex liability landscape fractional owners face, especially when passenger load liability exposure comes into play.

Passenger load liability exposure

Within fractional ownership programs, the fleet is likely to include aircraft with a range of capacity limits, from as few as six passengers to as many as 19 passengers. This is when load liability exposure comes into play. If you own a share of a six-passenger aircraft but fly on a 15-passenger or larger plane, confirm your coverage accounts for the added liability.

Jet card members (without fractional ownership stakes)

Private jet program participants often do not have an ownership stake in any aircraft. These members, commonly referred to as jet card members, purchase single trips from the charter market or buy packages of flight hours.

Because they are rarely listed as named insureds on fleet or owner policies, coverage gaps can occur. Without a non-owned aviation liability policy, these members may have little to no protection and could face full exposure if named in a lawsuit. To address these gaps, there are different types of non-owned aircraft insurance available.

Types of non-owned aircraft insurance 

There are two main types of non-owned aircraft liability insurance: corporate non-owned and personal non-owned.

Corporate non-owned aircraft insurance

This coverage is suitable for corporations and high-net-worth individuals involved in fractional ownership. It primarily covers contingent liabilities when you do not employ the crew and are not directly involved with the operation and maintenance of the aircraft. Fractional aircraft ownership is a popular and cost-effective way for many individuals who need aircraft transportation to gain access to those types of assets without the complete commitment that 100% ownership requires.

Personal non-owned aircraft insurance

While by name this may seem applicable for high-net-worth individuals in fractional ownership programs, this coverage is actually best suited for individual operators such as licensed rental pilots and student pilots.

Further coverage considerations

Non-owned aircraft liability insurance provides essential coverage in the event an aircraft you do not own, or an aircraft in which you partially own, causes bodily injury or third party property damage. For damage to the aircraft itself, non-owned hull coverage is an important option to consider.

Hull coverage protects you and your guests from property damage losses such as spilled food or beverages, torn seat upholstery or accidental breakage of parts onboard the aircraft, such as a lavatory door handle. With the right combination of liability and hull coverage, better prepare for any incidents that might occur onboard.

Learn more about securing the aviation coverage 

Fractional aircraft ownership through private jet memberships and other programs offer an unmatched travel experience without the full costs and responsibilities of sole ownership. As flight activity continues to grow and programs expand globally, however, liability exposures are becoming increasingly complex.

Comprehensive aviation insurance plays an important role in helping private aircraft owners enjoy the benefits of air travel with confidence, with protection designed to respond to unexpected risks.

Brown & Brown’s aviation specialists work with aircraft owners, fractional program participants, and advisors to help navigate evolving liability considerations and secure coverage aligned with today’s aviation risk landscape.

To connect with an aviation specialist at Brown & Brown, submit an inquiry form. You can also explore additional risk management guidance on our Personal Lines Risk Resources page. To learn more about Non-Owned Aviation Insurance, visit our FAQs about Non-Owned Aviation Insurance.