FAA Expands Safety Management System (SMS) Regulations in 2024: What You Need To Know
One of the cornerstones of safety in aviation is that it isn’t a state but rather a practice. How stakeholders manage safety on an ongoing basis is essential. Of course, maintaining a consistent focus on preventing injuries, property damage and other negative events isn’t easy. That is one reason the safety management system (SMS) concept was developed.
This article covers recent rulemaking by the U.S. Federal Aviation Administration (FAA) and describes how safety management system (SMS) regulations are increasing safety. It also notes that having an SMS (especially a mature program) casts aviation stakeholders in a favorable light with insurance providers, leading to increased insurability and potentially a more comprehensive insurance program.
FAA Expands SMS Regulations
Like many evolutionary changes, the aviation industry’s journey of implementing SMS programs started as a local solution—in this case, to address safety needs in flight operations—and caught the attention of other aviation disciplines. Following the International Civil Aviation Organization’s (ICAO) publication of standards and recommended practices for SMS development, the marathon to implement these programs began on a global scale.
ICAO defined an SMS as a systematic approach to managing safety, including the necessary organizational structures, accountability, responsibilities, policies and procedures. Around the world, lawmakers and regulators established their foundational expectations for SMS programs while the industry wrestled with the challenges of their practical application.
Before publishing mandatory SMS regulations, the FAA established voluntary programs for the industry to adopt. These programs provided opportunities to develop and assess SMS solutions and inform potential rulemaking. They involved airports, airline operators, maintenance providers, and later, designers and manufacturers.
In 2015, following rulemaking that included public and industry input, the FAA published mandatory SMS regulations (14 CFR Part 5) with a three-year implementation period for those conducting operations under Part 121. In parallel, the voluntary SMS program opportunities continued for other aviation organizations.
In 2023, the FAA added SMS requirements for certain airport certificate holders (14 CFR Part 139) to develop, implement, maintain and adhere to an airport safety management system. In 2024, the FAA expanded the applicability for compulsory SMS programs. Aircraft manufacturers’ SMS requirements are now addressed (14 CFR Part 21), as are those for parties conducting commuter and on-demand operations or passenger-carrying flights for compensation or hire (14 CFR Parts 135 and 91.147).
FAA Administrator Mike Whitaker recently stated, “Requiring more aviation organizations to implement a proactive approach to managing safety will prevent accidents and save lives.”
Voluntary SMS Opportunities and Recognition
Importantly, the FAA continues to offer a voluntary path for aviation stakeholders who are not required to have an SMS but want to be recognized for embracing the standard (14 CFR Part 5). Companies and operators who pursue the voluntary path cast themselves in a positive light, enabling the insurance community to better gauge a risk’s safety posture.
The FAA states the following are some of the benefits of managing safety with a voluntary SMS:1
- Increases safety by supporting a proactive, predictive method of managing safety to identify and address problems before they occur.
- Demonstrates safety as a priority to recruit and retain high-caliber staff and to strengthen an organization’s safety culture.
- Realizes cost savings with the ability to anticipate and prevent costly accidents.
- Improves data-informed decision-making to prioritize resource allocation.
- Increases customer confidence in the Certificate Holder’s ability to operate safely and potentially increase new and returning business.
- Enhances communication about safety by using common, consistent terminology within the organization and throughout the industry.
- Increases eligibility for certain contracts.
- 14 CFR Part 5 compliant SMS is recognized by International Civil Aviation Organization.
Improving Aviation Safety Through Information Sharing
The latest SMS regulations include an information-sharing requirement (14 CFR 5.57), which drives the industry to work together to identify and address potential safety issues. Industry stakeholders have been calling loudly for improved sharing of safety information. Since 2007, U.S. airlines have had a data-sharing program known as ASIAS (Aviation Safety Information and Analysis Sharing), and it makes sense for other aviation constituencies to adopt a similar framework.
In publishing the §5.57 requirement, the FAA also described limitations on this shared information and provided illustrative examples of “how aviation organizations can meet the hazard information sharing per § 5.57 without compromising confidential business or personal information, by: (1) identifying the interfacing person who could address the hazard or mitigate the risk; (2) confirming that the interfacing person contributes to the safety of the products or services provided by the aviation organization; and (3) removing any proprietary or confidential information other than the hazard details from the report prior to sending it to the interfacing person.”
In May 2024, Congress further strengthened the guardrails, expanding the limitation on disclosure of safety information (49 USC 44735) to include reports, data or other information submitted “for any purpose relating to the development and implementation of a safety management system, including a system required by regulation.”
Future Aviation Success Demands Predictive Safety Behaviors
The FAA SMS regulation updates in 2024 demonstrate that the organization continues to evolve its safety management activity toward predictive safety, focusing on capabilities to spot issues and pick up weak signals before mishaps occur. This is underway in the legacy aviation world with airframe and engine condition monitoring, flight and airport operations monitoring and air traffic safety reporting programs.
These challenges are occurring in a proven ecosystem while, simultaneously, the FAA works to ensure that new technologies, such as Advanced Air Mobility, leverage predictive safety opportunities. There is much to consider and balance, but the FAA is striving to marry predictive safety with legacy aviation and all the new technologies that are being introduced.
Like the FAA, Global Aerospace recognizes the benefits of having a robust SMS in place, which includes the influence a strong focus on safety has on insurance program considerations. That commitment aligns with and is supported by our SM4 Aviation Safety Program and library of safety-focused articles. We encourage all aviation stakeholders to capitalize on these resources as tools for managing safety more effectively.
Resources:
1 https://www.faa.gov/faa-aviation-safety-outreach/safety-management-system