The private aviation insurance market is once again shifting gears, with a return to softer conditions following a prolonged hard market cycle.
But while increased capacity is driving competition and easing premiums, industry leaders warn that underlying volatility and rising claims severity remain unresolved challenges.
According to Jason Riley (pictured), managing partner at Acrisure Aerospace, the current softening trend is largely being driven by an influx of underwriting capacity, creating heightened competition among insurers. But while premiums are declining, claims costs continue to rise.
“I don't think the market's very congruent,” Riley told Insurance Business. “We have rising expenses in the aviation insurance claims world, but under these competitive pressures, we're still seeing declining premiums. I expect that continues through 2026 and 2027, despite some of those claims headwinds.”
Private aviation saw an unexpected boost during the COVID-19 pandemic, reversing what had been one of the longest soft-market cycles in recent history. “I think at the end of the day, (the pandemic) was a net positive for the aviation industry,” Riley said, pointing to increased demand for discretionary assets such as private aircraft.
That surge helped push the aviation insurance market out of a soft cycle that had persisted from the early 2000s through roughly 2019–2020, triggering a sharp transition into a hard market. This harder phase, marked by rising premiums and tighter underwriting, lasted until late 2024 or early 2025. Now, the pendulum has swung back again.
The private aviation sector is no stranger to dramatic boom-and-bust cycles. But as artificial intelligence (AI) and automation tools gain traction, Riley questions whether technology could finally smooth out the sharp swings that have long defined the market, especially as better data and faster analysis feed into more consistent underwriting decisions.
“What I would hope is that the magnitude of these (market) swings starts to compress,” Riley said. “We could get into a more normalized band instead of these wild ups and downs.”
New entrants and existing carriers alike are increasingly leveraging data from previously untapped sources, using automation to refine risk assessment and pricing. For policyholders, this could mean more tailored coverage and fewer abrupt pricing shocks.
However, the Acrisure leader remains cautious about overstating the near-term impact of these technologies, particularly in a market dominated by unpredictable, high-severity events.
“We’re a severity-driven industry. Frequency is a problem, but severity is really our biggest challenge. You can compile tons and tons of data, but you can’t out-data a flock of ducks,” Riley said, adding that the industry may be “a couple, three, four years out” from understanding how data-driven approaches will reshape actuarial models.
Where Riley sees more immediate value is on the brokerage side. Enhanced data tools and automation can help brokers better represent clients and match risks with the most suitable carriers.
“I personally think AI is a better brokerage tool than an underwriting tool,” he said.
With dozens of active markets in aviation insurance, brokers play a critical role in navigating varying appetites and aligning clients with the right coverage.
Technology can accelerate this process by enabling brokers to “paint the best possible picture for every single client” and deliver relevant information to underwriters more efficiently.
Despite the growing role of automation, Riley stressed that aviation insurance remains fundamentally relationship-driven.
“The beauty of our business is that it’s part art and part science,” he said. “The science piece is what we can automate… It’s the art piece that I don’t think you can ever really strip humans out of.”
Looking ahead, Riley advises brokers and clients alike to remain mindful of the market’s cyclical nature. While current conditions offer opportunities to reduce costs, they also present a chance to strengthen coverage and prepare for future tightening.
“Take advantage of price reductions where you can,” he advised insureds, “but take a fair amount of that and allocate it to buy more limit, buy more coverage.”
He also urged clients to preserve savings rather than redeploy them too quickly, warning that a return to a hard market could be swift.
“All those savings that accumulate over the next couple of years could evaporate pretty fast,” Riley said.
