Drones are very expensive pieces of equipment, and accidents happen that can damage the drone itself, damage other property, or injure people on the ground. Having to replace equipment or the drone itself or lacking the ability to cover your liabilities could quickly put you out of the drone business.
So the question you should ask yourself is not just, “Should I have drone insurance?” but also “How much drone insurance do I need?”
Do You Legally Have to Get Drone Insurance?
If you want to take the risk, the FAA does not require you to carry drone insurance. Be sure to check state laws, however, as states have their own requirements. Not having insurance might limit how you can use your drone.
Some companies require that you carry insurance on your drone before they will hire you. There are other projects you may not be able to accept if you don’t have drone coverage, such as those requiring permits from cities. You also won’t be able to take off from some businesses until you show them your proof of drone insurance.
Legal requirements aside, consider your out-of-pocket expenses in the case of an accident if you are uninsured. You could end up paying to completely replace your drone and all of its equipment, repair the damage it caused when it crashed, plus pay medical expenses for bodily injury for anyone hurt in the accident. That may be an extreme example, but extreme examples are what make good insurance coverage worth the cost.
Who Should Get Drone Insurance?
If you use your drone for commercial purposes, a good drone insurance policy gives you the peace of mind that you are protecting your business along with your equipment. Several industries use drones for commercial purposes, such as:
- Law Enforcement
- Movie and TV Production
- Concerts, sporting, and other events
- Real Estate
- Commercial Photography and Videography
- Package Delivery
With advances in technology, there is little limit on how many industries can use drones in some capacity. As a drone owner, you should have all the pieces in place to accept work. Not only will your drone insurance open doors for you, but it also helps show that you are a responsible drone user.
What Is Covered Under Drone Insurance?
Once you decide to get drone insurance, you next decide on the types of coverage you need and in what amounts. This is not the place to decide to save money, but rather to determine the best way to protect your drone and your business.
Drone Liability Insurance
Liability covers you if your drone injures another person or causes damage to other property. It does not cover the drone itself or any attached equipment. For smaller jobs, having $1 million to $5 million in liability coverage may be enough. But depending on the circumstances, you may need insurance coverage into the tens of millions of dollars. In fact, some companies may require that you carry that much liability coverage before they will hire you.
Drone Hull Insurance
Hull insurance covers damage to your drone and any attached equipment. You can also talk to your broker about any additional coverage, such as for ground stations. You may have a warranty on your drone, but if that warranty doesn’t cover every possible scenario you are looking at large out-of-pocket repair or replacement expenses.
People sometimes make claims against drone operators for things related to advertising, such as copyright infringement, invasion of privacy, stolen ideas, or slander. Advertising liability insurance for your drone gives you coverage against advertising claims.
How Much Drone Insurance Do You Need?
You can determine how much liability insurance you need depending on four factors, including:
- What requirements do you anticipate at your job sites?
- How much liability coverage will keep your business protected?
- Your minimum liability coverage should be at least $1,000,000
- Whether you have the option to increase your liability during the course of your policy
To determine the amount of physical damage, or hull coverage you need, ask yourself two questions:
- How much will it cost to replace the drone?
- How much will it cost to replace the attached equipment?
Factors That Influence the Cost of Your Drone Insurance
Like with any other type of insurance coverage, companies that offer drone insurance are going to look at several risk factors when deciding whether to offer you a quote or the price you will pay for your coverage. There are several factors that can increase or lower your premiums, including:
- The size and type of drones you plan to use
- Whether you want liability coverage, hull coverage, or both
- The amount of insurance you need
- The size of the area you will be covering with your drone
- The type of area you are covering, such as whether you will be flying over water or remote areas
Some risk factors are related to you as a drone operator, such as:
- Logged hours with the type of drone you will be operating
- Possession of a valid FAA UAV license
- Possession of maintenance logs for your drone
- Flight logs with details
- Your safety record with drones
When you talk to a broker about drone insurance, make sure you bring as much information as you can, in great detail, to show why you are a good risk. You should also ask your broker any questions you might have about drone insurance. An inability to answer your questions is an indication that a broker doesn’t have the experience you need to help you protect your drone and your livelihood.
Learn More or Get a Quote
Don’t be one of those drone operators who regrets not having insurance after an accident. Learn more about drone insurance or get a quote by visiting BWI Aviation Insurance. We offer liability and hull coverage for drones, with policies protecting you up to $25,000,000 so you can take on those big jobs.
Investopedia named us one of the top drone insurance companies for 2022 based on our high liability coverage limits, our annual plans, and your ability to customize your policy with add-ons to best protect yourself.