What is pilot loss of license insurance, and do you need it on top of disability insurance?
Pilot loss of license (loss of medical) insurance is a form of own-occupation disability insurance that pays when the FAA medical standards make you unfit to fly, even if you could still work in another job. Typical professional-pilot plans pay a monthly benefit of around 60% of pre-disability salary, reduced by offsets such as Social Security or workers' compensation, for a defined period. They're aimed mainly at airline and commercial pilots whose income depends on a medical certificate. Private pilots who fly for fun usually need ordinary disability cover instead. This page is part of our aircraft & aviation insurance cluster.
- The key feature is a pilot-specific own-occupation definition: you're disabled if you can't safely fly under FAA medical standards.
- A representative plan pays 60% of salary monthly, excluding per diem and overtime, with benefits offset by Social Security, workers' compensation and pensions.
- Pre-existing condition clauses are common. A representative plan excludes conditions treated in the 12 months before enrollment for 24 months.
- Mental illness and substance-related claims often carry a 24-month lifetime maximum.
- Employer group long-term disability often uses a broader 'any occupation' test after 2 years, which is the gap loss of license cover fills.
How Loss of License Insurance Pays
• Short-term stage: Benefits can start from day 1 after an injury or day 8 after an illness.
• Long-term stage: Begins after the short-term period (for example, 6 months), with an own-occupation definition for a set number of years.
The waiting period before benefits start is the elimination period. Compare it with your savings using the Disability Insurance Calculator.
Loss of License vs Ordinary Disability Insurance
If flying isn't your income, a loss of license policy adds little. Focus on ordinary disability cover for your actual job and on life insurance that covers flying. Sport pilots flying on a driver's license under light sport aircraft rules face different medical-eligibility triggers.
Who Should Buy It
Illustrative Case: The Grounded First Officer
Scenario: A 34-year-old first officer earning $120,000 base was diagnosed with a cardiac arrhythmia that disqualified him from holding a first-class medical while he went through the FAA special issuance process. He could still work a ground job.
Resolution & Judicial Outcome: His group long-term disability plan argued he could perform other work. His loss of license plan paid 60% of his base salary ($6,000 a month) under its pilot-specific own-occupation definition, minus offsets, until he regained his medical about 14 months later.
What You Should Do: Step-by-Step Action Plan
Critical Mistakes to Avoid
- Assuming group long-term disability will pay if you can't fly but can do a desk job.
- Forgetting benefit offsets when budgeting.
- Waiting until after a health scare to apply.