Eric,
Usual warnings about this not being legal advice and not representing you. In general - it may vary by state - having a corporation own your airplane does not give you any liability protection if you are the one flying it during an accident. Your hand on the yoke, you're the one potentially liable for damages. Corporate ownership is generally worth considering if you own the airplane with someone else - that way you are less likely to be at risk for liability if the someone else has an accident. Also, if you do a lot of volunteer flying and the airplane is in a corporation, the corporation is renting the airplane to you and you can deduct the full cost of the rental. If you own the airplane outright, you can only deduct the cost of fuel and oil for the flight. In addition, if you have the airplane owned by a corporation, you incur the fees the state charges to form and annually register the corporation and the corporation has to file a tax return - and it may make an income that is taxable. Plus, it takes time to track the corporate finances so you can prepare the return.
When it comes to liability protection the answer is a combination of insurance - to protect your assets after an accident and regular recurrent training - to prevent you from having an accident. (Some insurance companies give a premium discount if you take regular recurrent training such as a FR every six or 12 months because their underwriters know that it cuts down your risk of having an accident substantially. Last I saw, the average time since a FR for pilots involved in an accident is 13 months.)
