Lender's Policy Coverage
The EAGLE Protection Aircraft Loan Policy provides protection
against the following:
In certain circumstances, supplementary coverage may be obtained with the payment of additional premium. Optional coverage may be purchased for the following:
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Additional state and federal tax lien coverage up to the value of the aircraft
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Foreign title claims on imported aircraft
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Closing letters
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Titles to engines
Priority of the Lien
This coverage protects you from the interests of other lien holders who claim priority over your security interest.
Invalidity or Unenforceability of Your Lien
Coverage is provided against claims that your lien has not been properly signed, delivered, recorded, or is otherwise invalid or unenforceable.
Cape Town Coverage
The Cape Town Convention applies to almost all U.S. aircraft transactions that close on or after March 1, 2006. It is especially important to lenders because a lender who fails to comply with the Cape Town Convention is essentially unperfected against the claims of third parties and competing creditors. Furthermore, because this law is new, untested and subject to a variety of interpretations, many lenders are not sure what, where or how to file in order to comply with the FAA and Cape Town Convention. The policy provides peace of mind -- and coverage -- that your rights as a secured creditor are protected and perfected under both the FAA and the Cape Town Convention. Many prudent lenders are now making title insurance part of their closing requirements.
Ownership Disputes
The EAGLE Protection Aircraft Loan Policy insures that your borrower is the owner of the aircraft. This goes beyond simply insuring that the FAA registration records are accurate. Basically, we insure that you're dealing with the rightful owner.
Document Forgery
Coverage is provided when your lien is impaired by a forgery occurring anywhere in the chain of ownership to the aircraft or in your security agreement.
Fraud or Duress
Similar to forgery, this coverage protects you in the event that any transfer document in the chain of aircraft ownership is not valid because it was obtained by fraud, undue influence or duress.
Incompetence or Incapacity
Coverage is provided when any document transferring ownership was signed by a person legally incapable of completing the transaction because of age, incapacity, or lack of partnership, corporate or trust authority.
Defective Filing or Recording of Documents
This coverage protects you against defects in any filed or recorded document necessary to establish your security interest in the aircraft and your borrower's ownership of it.
Post-Policy Forgery
Unfortunately, it happens. Occasionally, unscrupulous persons will attempt to falsify a release of an unsatisfied security interest. If this should happen, we will cover ensuing losses to you, including the cost to restore your lien to the record.
Unrecorded State, Local and
County Tax Liens (up to $25,000)
Coverage for up to $25,000 is provided against state tax liens which did not appear in the FAA records. Such off-record liens may be enforced against the aircraft if it lands in the taxing state.
Federal Tax Liens (up to $250,000)
Coverage for up to $250,000 is provided against unexpected federal tax liens that did not appear in the FAA registration records.
Labor or Materialman's Liens (in most states)
We will protect your interest when prior non-possessory labor or materialman's liens are claimed for payment of services, labor or materials furnished to the aircraft before the policy date, and which your borrower did not agree to pay. And with limited exception, we will also protect you from post-policy labor, service or material providers asserting a lien right prior to yours.
Foreign Deregistration
You are protected against claims that the aircraft's United States registration is invalid because it was not properly removed from a foreign registry. And, should a foreign lender seek to enforce its lien in the United States, the EAGLE Policy protects you.
Gap Coverage
Sometimes material cannot be retrieved from any recording system, including the FAA's, immediately after its submission. At the FAA this "blind spot" can last several hours, and could pose a risk to your lien. This risk is covered by the EAGLE Protection Aircraft Loan Policy.
Another gap problem can occur when a document is rejected for recording after it is filed. Without a recorded document, your interest is jeopardized, but with the EAGLE Policy, you're fully protected.
Engine and Propeller Lien Coverage
Coverage is provided against liens and encumbrances recorded in the public records on the engines and propellers.
Foreign Title Claims on Imported Aircraft
Protection against title attacks from foreign lien holders asserting their claims in the United States may be obtained through a separate endorsement.