Drone Liability Insurance – What Is It and Do I Need It?

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The use of Unmanned Aerial Vehicles (UAV) is on the rise. With the ability to capture and record high quality aerial shots in various locations as well as distance, drones have become a new favorite amongst hobbyists and enthusiasts. Flying a drone could be a fun-filled and exciting activity, but using a drone for business purposes can be a tool to take your business to the next level.

Today, many drone operators improve their skills not just for recreational purposes but with their business in mind as well. Drones can be used to capture the aerial beauty of real estate properties, to perform land surveys, to get aerial footage of a live event; the possibilities are endless. But just like any other businesses, there are things beyond our control. Liabilities due to accidents can still happen even if you follow all safety rules and flying protocols.

Insuring your drone might be a new concept, even if you already have other types of business insurance. Learning the features and coverages of a drone insurance policy are essential to being sure your business is protected.

What is Drone Liability Insurance?

Commercial drone insurance is similar to some other types of liability coverage protecting you from claims of bodily injury or property damage. In addition to liability coverage for damage to the property of others, a drone policy can also cover your drone for physical damage to the drone itself. If your drone is lost or damaged in an accident, the insurance company will cover all damages and costs incurred up to your declared limits.

Insurance companies use detailed underwriting when issuing a drone insurance policy. In many cases, they require the drone pilot to have maintenance logs, operating manuals, a record of parts, and proof of training to indicate that you are a safe flyer. This is done to ensure that your insurer understands the risk to your drone, to other people, to the objects around you, and potential for loss to the insurance company itself.

Keep in mind that the safer and more prepared you are, the higher your chances are of obtaining a drone insurance policy at the most affordable rates.

Do I need Commercial Drone Insurance?

Since the concept of using drone for commercial purposes is fairly new, there aren’t any standard rules and regulations when it comes to insuring drones. But in the U.S., the Federal Aviation Administration (FAA) is the main body responsible for regulating the use of Unmanned Aerial Vehicles since they classify it as an “aircraft”.

For commercial drone use, it is imperative to get coverage to protect your business from liability even if it is not required by the government. There are many risks involved when flying drones, and without the right insurance, your business is exposed to potential liabilities.

Here are some of the most common businesses or industries that might require a drone insurance policy.

  • Real estate agents including home inspectors
  • Engineering companies and construction firms
  • Commercial photographers, videographers, and filmmakers
  • Law enforcement
  • Emergency response units and damage assessment teams
  • Fire and rescue operation businesses
  • Traffic monitoring, media, and news gathering
  • Agriculture, crop, and related industries
  • Railroad, highway, and structure maintenance businesses

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What does Drone Liability Insurance cover?

There are two basic types of drone insurance that apply to small and midsize businesses – hull coverage and liability policies. Depending on the type of business and your needs, it’s important to choose the right drone insurance coverage for the exposure you’ll have from operation your drone.

Hull Insurance: provides coverage for the damages to the drone or UAV itself. Typically separate from a liability policy, most business owners tend to neglect hull insurance thinking that drones are cheap and easily replaceable. But if your drone is equipped with expensive cameras, top-class sensors, and onboard real-time kinematic or RTK GPS units, a hull policy should be a top priority.

Liability Insurance: offers protection for damages caused to third parties as a result of drone operation and generally includes coverage for bodily injury and property damage. Most companies and larger businesses require liability insurance before they allow drones to take off on their premises. The same applies to contractors who often lease drone services.

Commercial drone insurance coverage varies depending on your policy and declared limits. But most of the time, it includes coverage for:

  • Loss or damage to the drone itself or UAV along with associated equipment
  • Protection for aircraft operators including on-ground crew and non-pilot personnel
  • Third party legal liability
  • Premises and fire legal liabilities

Business Insurance

Running a business is challenging enough without having to worry about lawsuits, employee injuries or property damage. Having the right insurance gives you the peace of mind to focus on what matters - running your business.

The coverage you need depends on the type of business you run. A restaurant owner needs to be covered against customers possibly getting food poisoning while an accountant needs to be covered against calculation errors. CoverWallet's intelligent assessment system will identify the insurance you need based on your specific business, get you a policy that fits your budget, and do it all in less time than you think.

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