President's Perspective
"... it is not as simple to do as it is to suggest."
There is no question in my mind that the insurance provided with AMA membership is the primary reason most members join, even though the AMA provides the aeromodeler with much more than insurance.
A couple of months back, I wrote a column on technological advancement and its effect on aeromodeling. At the end of that column, I reflected on the idea of a tiered membership system as a method of coping with the widening gap between basic aeromodeling and the higher, faster, bigger aeromodeling made possible by advancing technology. It has been suggested by members for a long time that this would be desirable, but, as usual, it is not as simple to do as it is to suggest!
Understanding the insurance complication
To understand the complication, it is necessary to understand the structure of the AMA insurance program, as well as the reasons and benefits of that structure. To begin with, it is important to understand that insurance is regulated by the states rather than the federal government, and that there are only a small handful of insurance companies that are licensed to operate in all 50 states.
To sell insurance in a state generally requires a license in that state, and the laws regarding the sale of insurance are different in each state. Fortunately, insuring an association and providing insurance to members of an association as a benefit of membership is not subject to all of those different rules and licenses. Therefore, it is very important that the insurance be provided as a benefit of membership, and not simply "sold." It may seem like a fine line, but it is a very important line!
I am sure that this will surprise a few members, but the principal need for AMA's insurance is not for the individual member, who most often has a homeowner's or renter's policy, but rather for the club and the site owner.
I'd guess that it would be rare to find an AMA-chartered club that has any liability insurance other than the AMA policy, and the AMA policy is primary insurance (meaning that it provides coverage before any other insurance policy takes effect) for the site owner.
This concept of primary vs. excess (sometimes referred to as "secondary") insurance is misunderstood by many, if not most, members. Primary insurance provides first-dollar coverage (after a deductible amount), and usually provides the legal defense in any given case.
Excess insurance picks up when the primary coverage is exhausted, and covers to its limits. If there is no underlying (primary) insurance in effect, or if the primary insurance carrier denies coverage for whatever reason, the secondary coverage takes over. To the insured, it makes no difference; it's a matter for the insurance companies to worry about.
It's somewhat like having your garage burn down and worrying whether the car is covered by the homeowner's policy or the automobile comprehensive policy. As long as it is covered, who cares?
Another factor to consider in the AMA insurance program is the fact that the member, the club, and the site owner all share in the same policy, and are insured to the same limit, from the same "pot." This is sometimes pointed out as a weakness in the insurance program but, in fact, it is a strength.
We all know that flying sites are hard to come by, and the last thing we need is to do anything to encourage lawsuits against site owners. Herein lies the advantage of this structure: the effect of this structure is to reduce the likelihood of a site owner being named in a suit. The reason for this is that naming the site owner in the suit will usually result in no additional insurance money availability, and no additional insurance company with which to "settle out of court."
This certainly does not slow down a suit against a site owner if the facts of the case warrant it, but it does slow down the "shotgun" approach if it is a clear-cut model airplane accident.
Two-tiered membership proposal
Keeping all of this in mind, I think we have come up with a structure which would allow a two-tiered membership, split into categories that would reflect their administrative cost and their relative liability risk. I have discussed this structure with the AMA's insurance broker and Special Services Director (who suggested this column), and we haven't found any holes in it yet. It has not been discussed with the Executive Council as of the time of this writing, but it will have been before you read this.
The breakdown between the tiers will be the hardest part, but the idea is to separate the really high-performance and large models from the "normal" ones. If there was a good way to measure speed, I'd use 20 pounds and 130 mph as a starting point for discussion, and I'd probably put most multi-airplane events, such as racing and combat, into the higher class along with turbines. Where this crossover point is would certainly affect the numbers we could expect in each category, but my guess is that we would get something close to an 80/20 split between the categories. There would be some additional insurance premium involved, but we don't think it would be too much.
Here's the bottom line: if we are able to do this, the result could be a reduction in dues to the majority of members, and an increase in dues for those modelers wanting to fly high-performance or large models.
My first cut at a revenue-neutral dues structure would reduce the basic (Open-full) membership from $48 to $40, and create a "high performance" membership at $40 additional, or $80. These numbers are not cast in stone, but are representative. What these membership categories would be called is up for grabs.
At this point it is just brainstorming, but I think it could be done, and it would address something that a lot of members have suggested. What do you think now that you have some approximate numbers to think about?
Till next month,
Dave Brown AMA President dbrown@dbproducts.com
Transcribed from original scans by AI. Minor OCR errors may remain.
