Drone Flying is becoming more common, and damage caused by these activities will increase. Drone insurance is available, so should you consider buying a policy? Read on as we look at the cost, what is covered and whether it’s really necessary or not.
Visit any picturesque site and the electronic whirring of small propeller blades is sure to be heard. Chances are a small drone will be taking high-quality video of the scene and the video uploaded on a social media platform before the day is out. Although amazing results are produced, drone operations often result in damage or injury. As injury and damage often have a financial component to it, having insurance may be prudent. In this article we will look at drone insurance, cost, applicability and whether it is worth it.
What is drone insurance?
Drone insurance is best defined by discovering what insurance does. Insurance according to Merriam-Webster is defined as the process where one party agrees to use a contract to indemnify another against loss by a specified peril. This definition helps us understand what insurance is and how it applies to drone flying – it is protection from specified (drone flying) peril. Drone insurance fulfils the insurance aim for drone pilots by ensuring that any potential financial loss is not borne by the owner/operator.
These financial implications are wider than simply the loss of a drone itself. Drone operators can also be held liable for damage caused by the operation of their drones – i.e. drone owners can cause car crashes, etc.
“If you’re simply flying a toy drone (less than $300 USD) for fun in your backyard or at a local model aircraft field, you might not necessarily need to purchase a $1 million liability drone insurance policy. But if you’re conducting business, flying on behalf of your company, or flying for some other kind of non-recreational purpose where another stakeholder might be involved, buying drone insurance is a smart move.”uavcoach.com/drone-insurance-guide
Are there different types of drone insurance?
As noted above, insurance is aimed to indemnify against loss of specified peril. When one considers drone operations, one can easily see how there can be a multitude of different potential perils – drones can be lost, damaged in flight or transport, or stolen. Thus, one needs insurance for the actual “hardware”.
Drones can however also cause damage or break laws that affect people other than the operator. As mentioned above, the operator could be held liable. Insurance is thus also designed to mitigate the risk for the operator in events that might result in public liability.
What does drone insurance cover?
Drone insurance can cover the bare basics, like just the drone replacement value if lost while flying the drone. These basic policies will be cheaper but will have greater risk involved.
The comprehensive insurance covers all aspects of drone operations.
Most operators should opt for a somewhat personalised policy that addresses the high likelihood of events that they face – i.e. if you travel a lot with the drone, including damage and theft. If you use your drone close to power lines, look for insurance that includes public liability coverage for power interruptions.
How much is drone insurance?
Drone insurance can be individualised and speaking to a broker can be beneficial.
For a hobby pilot, many factors affect price and differ widely on usage, replacement value, and cover purchased. For a look at what factors influence insurance pricing look at this Finder article.
Skywatch is a leader in drone insurance and offers insurance at an hourly rate – estimates of around $10 per hour. For a personalised Quote and better pricing ideas contact them direct at Skywatch quote.
How much is commercial drone insurance?
Commercial drone insurance depends on the size of the fleet that needs to be covered, as well as what operation is carried out.
There are a growing number of companies that offer insurance and getting multiple quotes that one can compare and use to negotiate with would be best.
Do you need insurance to fly a drone?
Insurance is not required to fly a drone as a hobbyist. For requirements of drone flying as a hobby refer to your country’s Aviation Authority.
If you regularly fly your drone close to other people, it is highly recommended to have public liability insurance, in case of third party damage such as bodily injury and/or property damage.
The FAA (Federal Aviation Administration) has further info on public safety and drones on their website here.
For commercial operations, public liability insurance is usually a prerequisite. Commercial operators should have insurance as drones can be expensive to replace and often have to fly into potentially hazardous conditions like old factories, high buildings in strong wind, etc.
Do drones usually come with a warranty?
Yes, most drones do have a warranty period when purchased new. Each supplier will have a warranty. Warranties do not cover operator mistakes though and cannot serve as a replacement for insurance.
Some manufacturers do offer “in-house” insurance or “drone–care” packages and might be worth considering for the hobbyist. DJI drones is one of the leading drone manufacturers in the world and offer a couple of care packages.
Does my home insurance cover my drone?
Home insurance suppliers in the USA and Australia should cover recreational use of drones as per Value Penguin. All owners should however check with their insurance whether it will be covered and for what instances.
Commercial usage of drones will not be covered by normal home insurance.
Where can you get drone insurance policies?
Drone insurance is available from many drone insurance companies and a quick internet search will give you many options.
Cover Drone is an internationally recognised insurance company for drone operations and is worth getting a quote from. As mentioned before Skywatch is popular in the US, and Investopedia recently made a ranking of insurers.
Speaking to your insurance broker is also worth the effort as most insurance companies will have a drone cover option or be keen to create one.
What is the best drone insurance for hobbyists?
It depends a lot on where the drone flying will primarily take place. For hobbyists who fly far from the public, having public liability might be a waste – i.e flying a drone in the wild to photograph animals.
General drone liability insurance might be a good idea if you fly a drone in a city with many other people, dogs, bicycles and general activity nearby.
As a hobbyist, joining a drone flying club might minimise risk and some clubs offer insurance as part of the membership fees. UAV Coach is an excellent website for guidance on all things UAV – including insurance.
Is drone insurance worth it?
It depends on the drone, the application and the risks involved.
As a business that needs drones for income, it would make sense to have insurance coverage, as nicely argued in this article by Avian.
As a hobbyist it needs to be an individualised approach. Get quotes, do the risk analysis and consider your personal circumstances. If it creates peace of mind, it may be worth it.
“Here are a few examples of potential accidents where drone insurance could prove beneficial:
- Damage or injury caused to a third party (property or people) during a crash
- Drone damage or loss due to loss of control resulting in a crash
- Damage or injuries caused to operating equipment, drone crew or bystanders
Drone insurance is a relatively new market segment in the insurance industry, but with drone usage increasing and predicted to grow in the future, it will become of greater significance. Do I as an individual need drone insurance? It is hard to make broad predictions and each individual should consider the types of insurance, the price of the drone and what the drone is used for when making a decision.
I believe it is only a matter of time before each household would have at least one drone – with or without an insurance policy.