6. Conclusion

In summary, our order today amends GO 120-C by adding a new Section 11 applicable only to lighter-than-air manned commercial balloons. Section 11 provides the following insurance options to commercial balloon operators:

· As an alternative to providing a policy with three separate limits required by GO 120-C(1)(A) - i.e., $100,000 per passenger seat per accident; $300,000 per accident for those on the ground, and $100,000 per accident for property damage liability - a manned balloon operator may meet the liability requirement through a combined single limit policy of $100,000 per passenger seat per accident and combined single limit minimum of $1 million applicable to all claims per accident. Under this scenario, an operator could fly no more than 10 passengers in all its balloons at any one time, unless it otherwise provided for $100,000-per-seat coverage for additional seats. The Form PE-794 executed by the insurer would note this limitation. This change in the amount of coverage required is made pursuant to Pub. Util. Code § 5505.

· As an alternative to the requirement of Section 8 of GO 120-C (requiring that evidence of coverage shall apply to any and all commercial flights operated by the insured), a manned balloon operator may file an insurance policy or policies with the Commission that cover only specifically listed balloons. Any operator that elects this option will have its operating authority limited to the balloon or balloons specifically named in the policy or policies on file with the Commission, until it files proof of additional insurance. The Form PE-794 executed by the insurer would note this limitation.

· As an alternative to the requirement of Section 1(A)(1) of GO 120-C (requiring a minimum of $100,000 per all seats on all aircraft flown), a manned balloon operator may limit its operations by filing with the Commission insurance and an affidavit describing limits on the number of passengers the operator will carry in each of its balloons so that the insurance on file with the Commission will continue to provide $100,000 per passenger bodily injury and death liability coverage, along with $400,000 of insurance per accident to cover personal injuries to those not aboard the aircraft and property damage. Any operator that elects this option will have its operating authority limited to the number of passengers set forth in the affidavit and policy or policies on file with the Commission, until the operator files proof of additional insurance. The Form PE-794 executed by the insurer would note this limitation.

The Commission recognizes the important cultural and financial benefits offered by the hot air balloon industry in California. As witnesses pointed out at hearing, many local communities and enterprises proudly feature pictures of hot air balloons in their advertising and logos. The changes that we make today in GO 120-C are intended to make it easier for balloon operators to obtain full insurance for their rides or, where full insurance is unavailable on terms acceptable to the operators, to limit the number of balloons flown or passengers carried until they can acquire more complete insurance.