Drones represent an exciting shift in the aviation industry. Today, hobbyists can experience first-person points of view in flight using unmanned aircraft, while professionals use these tools to film commercials, survey land, and more. However, there’s risk involved any time an aircraft leaves the land, whether it’s a manned aircraft or a drone.
In some events, drone operators may find themselves liable for damages to physical property or even injuries sustained by someone as a result of drone operations. These events could cost you tens of thousands of dollars or more.
That’s why it’s important to consider drone insurance.
What Is Drone Insurance?
Drone insurance is a unique insurance product specifically designed to cover risks associated with the operation of unmanned aircraft. These insurance policies typically come with various types of coverage including:
- Physician damage
- Medical expenses
- Payload cost
- Personal injury
- Equipment cost
Aside from being designed specifically for risks associated with drones, these policies are unique in that they’re highly flexible. You can choose to purchase a traditional insurance policy for which you pay premiums monthly as part of a long-term agreement, or you can take advantage of on-demand insurance – insurance that you only pay for when you need it.
How to Find the Best Drone Insurance
There are several drone insurance policies to choose from. As with any other product, they each come with their own benefits and price points, so it’s important to compare your options to make sure you get the best possible drone insurance at the best possible price.
As you compare your options, it’s important to consider the different types of coverage available and what you need, the prices of the policies you compare, and the differences between traditional insurance policies and on-demand policies.
Find the details of the aspects you should consider below.
Compare Liability Coverage
Liability coverage is one of the most important aspects of any insurance coverage involving a vehicle, whether it’s a drone, airplane, helicopter, or even a car. This insurance covers things like:
- Property Damage: If your drone collides with a piece of property and causes damage, your liability coverage will help reduce the cost of that damage.
- Bodily Injury: If your drone collides with a person, it could cause serious bodily injury, and you may be on the hook for the medical bills. However, your drone insurance policy should pay for some or all of these bills.
- Legal Defense: In some cases, you may need a legal defense as a result of operating your drone. In these cases, your drone insurance policy covers the cost of your legal defense.
As you compare, talk to your insurance agent to determine how much liability coverage you need, and make sure you get a policy that provides it.
Compare Physical Damage & Hull Coverage
If you have an accident with your drone, there’s a strong chance that the drone itself will take on damage. Those damages can be quite expensive depending on the type of drone you fly. After all, professional drones can easily cost tens of thousands of dollars.
As you compare your options, consider the type of drone you fly and how much it would cost to replace if an accident caused a total loss. Make sure your insurance policy provides enough physical damage and hull coverage to replace your drone if an event makes it necessary to do so.
Compare Payload Insurance
You may have a payload that you carry with your drone, depending on what you use it for. For example, if you’re a last-mile delivery service that enlists drones as a form of delivery, you never know how much the package you’re delivering is worth.
Even a small package may be a diamond ring worth tens of thousands of dollars.
If something happens in the shipment of the package, you’ll likely be on the hook for financial damages associated with the loss. As you compare insurance options, consider whether or not your drone operation involves payloads and how much coverage you need to have if it does. Then, make sure that the policy you purchase provides the amount of coverage you need.
Compare Personal Injury Coverage
Although the risk is relatively minimal, personal injury is always something to consider when operating a vehicle. Your drone may go haywire on takeoff or as you land it and hit you on the way up or down.
Drones are typically propelled by high-power engines and blades. If they collide with you, serious injury can occur.
A quality drone insurance policy will come with personal injury coverage, but it may not always be enough to cover your costs. Make sure to compare the personal injury coverage amounts offered with different policies, and pick an option that you feel most comfortable with.
Consider Optional Equipment Coverage
The equipment you add to a drone isn’t typically covered by standard drone insurance policies. However, most drone insurance companies offer optional coverage for additional equipment.
Consider whether or not you’ve added equipment to your drone. If you have, consider the cost of that equipment and make sure you select an insurance policy that gives you the option to cover that cost in the case of a covered event.
Consider On-Demand & Monthly Coverage Options
Drone insurance policies aren’t like health insurance, car insurance, or home insurance policies in that you don’t necessarily have to choose a policy that covers you 100% of the time. You can choose a policy that does, but that only makes sense if you fly drones often.
If you don’t fly drones often, you typically have the option to choose on-demand coverage. That means you can choose to only pay for insurance coverage on the day you decide to fly your drone. This can greatly reduce the cost of drone insurance if you don’t fly often, but it will increase the cost if you do.
Nonetheless, consider whether you need constant coverage or on-demand coverage, and choose a policy that fits your needs.
Drone insurance is relatively inexpensive. Most policies range from $550 to $1,000 per year. Nonetheless, you want to make sure that you get the best price possible.
As you compare prices, consider what you’re getting for each price. For example, a policy with $1 million in coverage is going to be more expensive than one with $100,000 in coverage. So, make sure you’re comparing apples to apples here.
Work With an Experienced Drone Insurance Broker
You can choose to purchase drone insurance on your own, but that may not be a wise idea. The best drone insurance brokers, like BWI Aviation Insurance, have relationships with the biggest underwriters in the industry. That means they’re able to make the best insurers compete for your business, getting you the best possible coverage for the best possible price.
That’s not the only reason to work with an experienced drone insurance broker.
The risk environment in the drone industry is complex and unique. It’s also relatively new, leaving many with several questions. When you work with an experienced drone insurance broker, you can rest assured that you’ll receive knowledgeable answers to your questions and that your broker will consider the risks you likely haven’t even thought about.
What’s Not Covered by Drone Insurance?
Drone insurance covers several events, but there are instances in which your policy may not provide coverage. Those instances typically include:
- Unlicensed & Unregistered: The person operating the drone must be licensed to do so, especially in a professional environment. Moreover, the drone itself must be registered with the Federal Aviation Administration. If the pilot is unlicensed and/or the drone is unregistered, claims are typically denied.
- Add-Ons: Most drone insurance policies don’t come with add-on equipment coverage. The good news is that most insurance providers offer optional add-ons to make sure this equipment is covered. So, if you have add-ons, make sure you purchase insurance specifically for them.
- Employee Injuries: If you own a company that uses drones for corporate purposes and an employee is injured as a result of the use of the drone, your drone insurance will not cover the claim. Employee injuries are covered by your workers’ compensation insurance.
- Reckless Activity: If you recklessly fly a drone into a wall or other object, you can expect your claim to be denied. Drone insurance only covers events that don’t happen on purpose.
- Illegal Activity: If the damages you claim happen as part of the commission of a crime, you can expect your claim to be denied.
Who Needs Drone Insurance?
There are no regulatory requirements for you to have insurance to operate a drone. Moreover, if you’re a hobbyist with a relatively light drone, there’s little reason to pay the premiums for coverage.
Instead, drone insurance is important for companies that use drones as part of their operations. Companies typically use heavier, more powerful drones that have the potential to cause more significant damage. Moreover, they usually fly drones more often than hobbyists.
Are Drones Covered by Your Homeowners Insurance?
Homeowners insurance typically covers items you keep in your home. However, it’s not likely to cover events that happen outside of your home and off of your property. So, if you’re standing on your property flying your drone over your neighbor’s house and it falls out of the sky causing damage, your homeowner’s insurance isn’t likely to cover the damages.