Air Affairs

Second edition 2015

The Corporate Publication of Dennis Jankelow & Associates (Aviation) (Pty) LtdPO Box 71626, Bryanston, 2021. Telephone: 0800FLYING. Website: www.jankelow.co.za. Email: mail@jankelow.co.za

WindsockWelcome to the 2nd edition of our Air Affairs electronic magazine. We had a great response from our first edition.

There have been a spate of fatal aircraft accidents in SA, and throughout the world, recently. Many of those affected would have treated insurance as a grudge purchase, to be dealt with as quickly and cheaply as possible, with no real consideration of the potential consequences following an accident. As we approach the Festive Season, many of our clients will be looking forward to packing the aircraft and flying off on holiday. If you are one of those intending to fly away in the holidays, now is a really good time to take a few minutes to quietly study your insurance documentation to ensure that it accurately reflects your requirements and that you fully understand your obligations – your Insurer certainly does.

With our best wishes for a happy and peaceful festive season and a prosperous 2016. The DJA Team

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Importance of Paper Work Checking your insurance coverage is becoming more and more important, it is vitally important that any loss you may have falls squarely within the coverage parameters of your insurance policy. Don’t be tempted to reduce costs by eliminating coverageBuying cheaply to save money is like stopping a clock to save time. Unfortunately, when it comes to insurance, the moment you realise that you have made a bad buying decision is usually the moment that it’s too late to do anything about it i.e. following a loss. Be sure that you have considered all the available coverages and have selected those that you wish to be protected under. Following an engine failure is no time to wish that you had arranged mechanical breakdown insurance but didn’t because you were trying to save money. Take a careful look at “the coverage envelope”“The coverage envelope” is the term DJA uses to describe the parameters that broadly define the coverage provided, as limited by:Permitted Pilots. Who may operate the aircraft and their minimum experience requirements. A clean loss record is often a requirement, so be careful to disclose any prior accident history.Permitted Uses. What the aircraft may be used for. Don’t take chances. If in doubt, fully disclose your intentions and obtain written agreement from your Insurers.Permitted Area. The geographical limits of coverage. Fly outside the area described and your coverage simply doesn’t apply, regardless of the circumstances. Check Sums InsuredAssess your aircraft value accurately. Don’t declare a value that is patently too high or too low. Either way, you’ll have problems in the event of a loss. Give careful consideration to the legal liability sum insured. Increased limits do not cost as much as you would imagine but legal liability claims can run into many millions of Rands, particularly in the event of serious injury or death. As the old adage goes: THE JOB AIN’T FINISHED ‘TIL THE PAPERWORK’S DONE!

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Current Affairs

AIRLARITIESHow do you know when you are half way through a date with a pilot? Because he says: “That’s enough about flying, let’s talk about me”!

Turning Full Circle

In 1972, a young aviation insurance broker in London met an equally-young aviation insurance underwriter and, over the next few years, they worked together on accounts placed by the broker’s firm, Willis Faber, with the underwriter’s company, British Aviation Insurance Company. In 1976, the broker decided to emigrate to South Africa and told the underwriter of his plans to relocate to Johannesburg.

The underwriter, who was a keen hang-gliding pilot, expressed an interest in also emigrating to South Africa – Cape Town in particular – where the hang gliding conditions were world famous. The broker told the underwriter that he had heard that his firm were seeking an aviation insurance specialist to join their Cape Town office. Later that year, the broker got a call from the underwriter to say that he had been appointed and was shortly arriving in Cape Town, where they would be working for the same firm.

The two friends worked together for the next few years, before one left to join DJA and they lost contact. The broker was Graham Speller and the underwriter was Chris Readman, who has recently joined DJA as a consultant. So, after 35 years, the connection has been restored and Graham and Chris are delighted to be once again working together!

AIRLARITIES

Three old pilots were walking across the ramp to their airplanes.

First one says, "Windy, isn't it?"Second one says, "No, it’s Thursday."Third one says, "Yeah, so am I. Let’s go get a beer instead.”

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Current Affairs

THE INSURANCE OF DRONES/REMOTELY-PILOTED AIRCRAFT SYSTEMS (RPASes) With the introduction of a regulatory framework for the ownership and commercial operation of RPASes, the insurance industry responded with the provision of insurance covering physical loss of or damage to RPASes – whether accidental or due to criminal/malicious acts of others - and insurance for legal liability arising from loss, damage or injury caused by RPASes.

At present, coverage is limited to commercial operations being conducted in accordance with Part 101 of the SACARs but may be extended to private operations which are performed in accordance with the same regulations. In both cases, compliance with the provision of Part 101 is a pre-condition for insurance to apply in the event of loss, damage or liability. For the purpose of the insurance coverage available, an RPAS is defined as an unmanned aircraft which is piloted from a remote pilot station but EXCLUDES toy aircraft and model aircraft.

The risks which can be insured against include: physical loss or damage, whilst stored, being transported or whilst being operated. Legal liability arising from the negligent operation of the RPAS, resulting in:

• Collisions with other aircraft• Injury to the public• Damage to property

Coverage does not apply to loss, damage or legalliability arising from the breach of the provisions ofPart 101, privacy by-laws and other laws enforceable by other authorities.

For more information and quotations, contact DJA.

SATELLITE TRACKINGWe wrote about satellite tracking in the last edition of Air Affairs and offer no apology for raising the subject again.

A pilot, flying alone in a single-engined aircraft, recently suffered an in-flight failure and was able to effect a successful forced landing, with little or no damage to the aircraft. The problem was, he found himself in a remote wilderness area, with no cell-phone coverage and unable to use the aircraft radios to summons help. 3 days later, he was found, dehydrated and close to death, some distance from the aircraft, by a search team that had been alerted by the pilot’s family when he failed to arrive at his destination.

It transpired that he had strayed off his intended course and the search area had been progressively widened until he was found. Another 24 hours and he would not have survived. A simple, inexpensive, tracking device – either permanently installed in the aircraft or carried as a portable device – would have enabled the pilot and his aircraft to be found within a few hours of him being reported overdue. If he had such a device and had triggered the in-built emergency button, the rescue teams could have been en route within minutes of him completing his landing.

Modern tracking devices allow for inexpensive text messaging, too, meaning he could have contacted his family to reassure them of his condition long before he was located. In this day and age - when few of us would dream of leaving home to travel more than a kilometer without ensuring we have our cell-phone with us - to fly anywhere without a satellite tracking system on board, or in a pocket, is simply irresponsible.

There is a broad range of products available. Don’t delay any longer. Get tracking before your next flight.

Call IndigoSat South Africa on +27 (0) 86 002 2121 or Gareth Willers on +27 (0) 79 697 4506. Otherwise, visit the website at www.indigosat.co.za.

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Current Affairs

Most aircraft owners have heard of “Lloyd’s” and many will find that their aircraft insurance, or parts of it, is underwritten by “Lloyd’s Underwriters”. However most people understandably think that “Lloyd’s” is an insurance company, whilst some think it’s got something to do with Lloyds Bank. Edward Lloyd owned a coffee shop in London in the late 17th century. Coffee was a very expensive commodity and coffee shops were very popular. Edward Lloyd’s shop in Tower Street was near the port and was frequented by ship owners who would meet there to smoke their pipes, drink coffee and discuss business. The ship owners realised that they could reduce their exposure to the loss of their ships and cargo if they shared the loss with others. So the idea of insurance was born. 10 ship-owners, for example, would agree to pay 10% of each other’s losses. Other businessmen got to hear about this and, not having ships of their own to put into the risk pool, offered to take the same level of risk in return for money – the first “insurance premium”.

It soon became generally known that, if you were a ship-owner who wanted to offload some risk, with or without accepting another’s loss, Edward Lloyd’s Coffee Shop was the place to go to make the right connections. More and more of the risk was being carried in return for premium, by businessmen who were developing expertise in the subject, and “risk-pooling” became less common. The risk-takers formed themselves into “syndicates” so they could accept larger levels of risks. Edward Lloyd’s business was booming. As an added service, he started to produce a daily list of ship arrivals, departures and those that had been lost or were delayed. The list would be distributed to the shipowners and risk-takers by the waiters employed by Lloyd, in addition to coffee, tobacco, etc. Some years later, “Lloyd’s List” appeared as a newspaper and, published continuously from 1733 to this day, is one of the world’s oldest daily newspapers. Risks were described on a slip of paper and offered to syndicates individual risk-takers by agents of the shipowner, known as “brokers”. A risk-taker would accept a share which would be written on the “slip” against the signature of the risk-taker that would appear under the risk details. Hence, those individuals who took the risk became known as “under-writers”. In 1713 Edward Lloyd died and, as his premises had become too small for the amount of business being done, the underwriters decided to move to new premises in Lombard Street, where they could run their new business properly. As a nod to Edward Lloyd and his role in the establishment of the new business of “insurance”, the new building (and every building since) became known simply as “Lloyd’s”. The men employed to run Lloyd’s and provide security, etc. were (and still are) known as “Waiters”.

Lloyd’s is not an insurance company. It is simply a place where insurance business is conducted by individual syndicates of underwriters. As one famous underwriter remarked: “Individually, we are underwriters: collectively, we are Lloyd’s”. Lloyd’s has been situated in Lime Street, in the heart of the City of London, since 1958 but moved to its current building in 1983. The market is sometimes referred to as “Lloyd’s of London”, or “Lloyd’s of Lime Street” but those in the insurance industry simply call it “Lloyd’s”. In our next issue, I will describe how Lloyd’s has evolved to this day and how the reputation of Lloyd’s has been built over the years.

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A story about a military pilot calling for a priority lading because his single-engine jet fight was running “a bit peaked”. ATC told him that he was number 2 behind a B-52 that had a one engine shut down. “Ah”, the pilot remarked, “the dreaded 7- engine approach”.

Aircraft Hull insurances customarily exclude losses arising from war, sabotage, malicious acts, strikes, riots, terrorism, political risks, etc. all of which are usually grouped together under what is called the War, Hijacking & Allied Perils Exclusion.

Many of these excluded risks can be insured under a separate Hull War Risks Policy which is usually underwritten in the specialist War Risks market at Lloyd’s. Coverage for malicious acts as simple as scratching the paintwork, or breaking a windscreen, are excluded under a Hull policy and will require an appropriate extension or separate War Risks policy.

Hull War Risks coverage will vary in cost according, in particular, to the areas in which the Aircraft is operated. For further information and quotations, contact DJA on 0 800 FLYING.

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Wing TipsHave you ever considered the trauma attached to losing or having your personal log book stolen? The solution is simple: duplicate it now and have a C.F.I. or the CAA authenticate it. Thereafter update both log-books simultaneously.

It goes without saying that, once you havegone to all the trouble of creating a duplicate,you should keep it in a separate place.

Products

Air Rescue DJA is a 24-hour emergency medical assistance service offered by DJA through a specialist service provider Blackplan Incident Management (Pty) Ltd. (www.blackplan.im)

Air Rescue DJA applies to any occupant of the Aircraft who suffers a medical emergency whilst on board or whilst embarking or disembarking. Coverage does not only apply to aircraft accidents. The service includes stabilization of the patient, transfer to an appropriate medical facility, transfer between facilities, etc.

Air Rescue DJA is a service which is uniquely designed for the aviation industry and applies to the crew and passengers of the specified aircraft.The benefits of Air Rescue DJA are as follows:• response by road or air ambulance to the scene of the incident * stabilization and primary care• transfer of patients to the closest most appropriate medical facility • telemedicine and flight-diversion management trauma counseling: telephonic and face to face • transportation of emergency blood and/or emergency medicine • companionship of stranded minors and care for next of kin • repatriation of mortal remains• 24 hour medical advice via the Air Rescue DJA dedicated

telephone number.

FOR AIR RESCUE EMERGENCIES THE NEW TELEPHONE NUMBER IS: 010 007 0229 (FOR CALLS WITHIN SOUTH AFRICA) OR +27 10 007 0229 (FOR CALLS FROM OUTSIDE OF SOUTH AFRICA).

AIRLARITIES

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Air Rescue DJA

HULL WAR RISKS

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AMO mistakes…whose loss is it? It’s your worst nightmare. 2 days after coming out of an AMO, your engine quits and you end up with a broken aerie following a forced lob into a ploughed field. Your ‘plane is dragged back to the AMO where the engine is opened under the watchful eye of the CAA inspectors. The verdict? A widget was put on back to front, resulting in the current mess. You glare at the AME, who keeps glancing at the big sign nailed to the wall of the hangar: NOT RESPONSIBLE FOR LOSS BY THEFT FIRE OR ANY OTHER CAUSE INCLUDING NEGLIGENCE OR GROSS NEGLIGENCE. BY ORDER.

But you don't care. Signs on walls have very limited effect. But you then pull out your copy of the job-card. Nightmare! The job card contains an exclusion of liability that makes the notice on the wall look tame! Still, you're not overly worried. After all, that's what you've got insurance for. With any luck, your policy allows you to accept conditions imposed by AMOs as a condition of work undertaken, without invalidating your own coverage. Be careful, however: not all insurance policies are the same.

Happily, your broker confirms that your Insurers are going to pay to the full extent of your coverage. But that's the next problem. Your coverage does not apply to mechanical breakdown itself, only to the consequences of it. Hence, the initial breakdown-related damage to your engine is not insured, but the consequent damage to the aircraft in the forced landing is, together with the costs involved in retrieving the aircraft.

A few weeks later, your aircraft is ready to be test-flown and you'll be back in business. Except that there are one or two things to be sorted out first. The damage to the hull was repaired just fine. Total cost: R850,000. No problem: your Insurers have already confirmed that, the moment you sign off on the repairs, the funds will be transferred directly to the repairer, less the Deductible. The engine repairs, however, came to another R300,000 and the AMO is not going to release the aircraft without payment.

You storm into the office of your Attorney and instruct him to "Release Hell" on the AMO. Furthermore, you want to sue for your loss of income, the depreciated value due to accident history and the Deductible.

You then discover that the job card was completed incorrectly by the AMO and your Attorney reckons he can have the liability exclusions set aside (he actually said "I can drive a truck through that thing!" but you know what he meant!). Your Attorney fires the appropriate broadside to open hostilities. You wait for news. Some days later you hear from your Attorney. Bad news. The AMO hasn't got any money, precious few assets and, worse still ... NO INSURANCE!

You remember that one of your friends had similar problem to yours some years before. You call him. In his case, you hear, the AMO's Insurers got involved immediately, appointed an Assessor and, once they realised that their client had, indeed, screwed-up, sat down to talk settlement.

But what about the job card, you ask? Didn't he have to sign one and didn't it mean he couldn't touch the AMO? On the contrary, your friend recalls, the job card he signed was very fair. It said that he couldn't hold the AMO responsible for any loss that he suffered for which he was already insured, but that they would stand foursquare behind him for any other losses arising out of their negligence.

But how could any AMO afford to be that generous? The AMO concerned arranged proper insurance, which allowed them to accept negligence-related liability. Sure, there was a cost implication which ultimately showed up in their labour and spares rates, but it also meant they were in a position to shoulder their responsibilities towards their clients.

So what is the moral of this little story?

Incredibly, there are NO regulations in South Africa that require AMOs to carry insurance to cover their potential liability towards their customers arising from faulty workmanship or any other liability arising from their activities. So some AMOs carry insurance whilst others do not. Some insure properly and others do not.

To avoid getting caught, read the job card carefully next time and ask to see a copy of the AMO' s current insurance certificate (if it isn’t already on display). If you don't like what you see in either case, think about it before you leave your precious aircraft on the AMO’s premises. All AMOs should be required to carry adequate insurance to provide compensation for the benefit of their clients, following loss damage or liability arising from their negligence.

AIRLOQUENT“Never let an airplane take you somewhere your brain didn’t get to 5 minutes earlier.” William Hazlitt

Claims

AIRLARITIES

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Over PA system “ Folks we have someone celebrating his 65th birthday today by taking his first flight.” (round of applause follows) “So after we have landed, be sure to stop by the cockpit and wish

Captain Jones a Happy Birthday.”

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Social Responsibility

DJA proudly associates itself with numerous charities but two of the social responsibility programs DJA are most actively involved with are: REACH FOR A DREAM FOUNDATION and SOUTH AFRICAN GUIDE DOGS – Read more at DJA Social Responsibility

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Social Responsibility

2015 PPL Raffle

Win a Private Pilot License course and make your dream of being a pilot reality.

Enter the DJA 2015 Christmas PPL Raffle

Visit www.aircrafraffle.co.za to enter on line Call 0800FLYING Email: raffle@aircraftraffle.co.za

Cost: R100 per ticket * Only 5000 tickets available * Draw 27th November 2015 Value: R100 000 at any flight school of your choice in RSA. Use for PPL or

Advanced Training Reach for a Dream Foundation. Non Profit Organisation number: 004-109. Lottery

Registration no: 00025/26

Fulfilled Dreams thanks to your support of the Aircraft and PPL Raffles

Here are just three of hundreds of dreams fulfilled with the monies raised from the Aircraft and PPL Raffles run each year by DJA.

Dreamer: Amy Falcon, 7, Acute Lymphoblastic Leukemia - GAUDream: Play with Dolphins with her best friendDate: 14 November 2014Amy’s whose dream was to play with dolphins together with her best friend. The Dream Team sent Amy on the best adventure of her life together with her family and best friend to Ushaka Marine World in Durban.

Dreamer: Ngcali Blakfesi, 8, Chronic Renal Failure – East LondonDream: Go somewhere nice with her familyDate: 22 May 2015Ngcali is a joyful little girl whose dream was to stay in a fancy place where she could have her very own shower, big bed and spend some fun time with her family. The weekend was full of Ngcali’s happy laughter and excited giggles; she touched our hearts profoundly.

Dreamer: Umako Ntshintshi, 10. Rare Congenital Heart Disease - MthathaDream: BicycleDate: 04 June 2015Unakho has a very complex and rare heart condition but she does not allow her illness to get her down. As she cannot run as fast as she wants, she dreamed of having her very own bicycle so that she could cycle and keep up with her friends rather than run. She was surprised in hospital with her dream bicycle, and insisted on eating her cupcake with her safety helmet still strapped on.

PHOTOS

PHOTOS

PHOTOS

DJA staff spent Nelson Mandela Day giving their time and goods collected to St Peter’s Child Care. Saint Peter’s Child Care is a long term special foster care programme based on the principle of providing a home environment to children.

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DJA Staff Changes

Chris Readman has joined the new DJA Cape Town office as a consultant.

Vickie Skinner has re-joined DJA as the Manager of DJA Cape Town after moving to Cape Town a few years ago. Welcome back Vicks!

Cara Rodger will be re-joining DJA after a short absence.

Seya More has joined DJA as a broker and Natasha Nundlall will be joining us soon, also as a broker.

Thandi Matshazi has joined DJA as an admin broker. Jason Temlett has joined the DJA new business team Bernice van Zyl has joined DJA from a strong insurance

background. Jennifer Reddy has joined DJA in the accounts

department. Colleen Winter has left DJA to join a charter company. Corne Groenewald and Louise Pietersen have left DJA

after many years with the company.

Who’s whoVisit the DJA website and put a face to a name.

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DJA StaffStaff Profile

DJA has opened an office in Cape Town. The office is run by Vickie Skinner, who has re-joined DJA, after having moved to Cape Town several years ago. DJA and Vickie are working with Chris Readman, appointed by DJA as a consultant. Chris has over 40 years of experience in aviation insurance and, as an active private pilot, is well-known in the Cape Town flying community.

A physical presence on the ground in Cape Town also allows DJA to continue to provide its Cape-based clients with the best possible service and the available expertise of 2 highly experienced brokers. We are excited about joining up with Vickie and Chris and formally opening an office in Cape Town. This is another important step in the development of DJA and will allow us to best attend to our clients’ needs and requirements. Contact Vickie on 084 403 2622 or Chris on 082 808 4114.

DJA opens in Cape Town

View photos

Trish Brownlow celebrated her 60th birthday in style in August.

Graham Speller started his career in insurance in London in 1972, joining Lloyd’s Broker Willis Faber & Dumas Ltd. Following several years as an aviation broker at Lloyd’s, handling business emanating from North America, the Middle East and South Africa, Graham decided to emigrate from the UK and joined Willis’ subsidiary company in Johannesburg as its aviation manager.

In 1980, he left Willis to join Dennis Jankelow & Associates, which was beginning to gain a reputation for aviation insurance. Over the next 35 years, together with the company’s founder, Dennis Jankelow, Graham developed DJA into the pre-eminent firm that it is today and is now considered one of the most knowledgeable practitioners in the global aviation insurance industry, a reputation that Graham (predictably) refutes.

Graham specialises in the technical aspects of aviation insurance, particular policy wordings, new product development, claims negotiation and legal insurance-related issues. He also provides training on all aspects of aviation insurance to DJA’s staff. His advice on aviation insurance issues is sought by clients, non-clients, insurers and attorneys from all over South Africa and around the world.

Graham and Lorna Speller live in Bryanston. They have three adult children, all of whom currently live and work in London. Graham enjoys sport, music and film and plays golf off a 9 handicap at Country Club Johannesburg.

Social MediaDJA will soon launch new Facebook,

LinkedIn and Twitter links

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Dreamer: Amy Falcon, 7, Acute Lymphoblastic Leukemia - GAUDream: Play with Dolphins with her best friendDate: 14 November 2014

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Dreamer: Ngcali Blakfesi, 8, Chronic Renal Failure – East LondonDream: Go somewhere nice with her familyDate: 22 May 2015

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Dreamer: Umako Ntshintshi, 10. Rare Congenital Heart Disease - MthathaDream: BicycleDate: 04 June 2015

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Chris Readman Bernice van Zyl

Colleen Winter

Jennifer Reddy

Corne Groenewald

Vickie Skinner

Cara Rodger

Jason Temlett

Natasha Nundlall Seya MoreThandi Matshazi

Louise Pietersen