Drone Insurance can be a tricky topic because there are a lot of misnomers out there. This article will clarify those questions and hopefully show you a route to getting drone insurance that will work for you.
Are you required to have drone insurance?
The short answer is no, you’re not required to have drone insurance (at least in the United States). This could change though and given the track things are currently on, it probably will. As of this writing though, you are free to fly commercially in the United States without drone insurance.
But let’s be clear. If you are flying your drone under a Part 107 license, you should be purchasing drone insurance, if for no other reason than it shows that you are professional and provide a reputable service. We’ll cover this below but it’s actually super easy to get drone insurance and it doesn’t cost much.
Just to be clear, it is unlikely that your home owner’s (or renter’s) insurance would cover you in the event of an incident. If you are flying commercially, it is very likely that your insurance company will not cover this use. It doesn’t hurt to ask, but if your homeowner’s or renter’s insurance covers your commercial drone flight, I would be VERY surprised. I’ve literally never seen it.
If you’re flying for personal use, you may be covered in some instances, but this would be a question for your insurance agent. Anyway, you’re not here to talk about personal use of your drone, you want to start a drone business!
What is drone insurance?
So, you need real drone insurance. But drone insurance is actually a type of aviation insurance. The FAA considers your drone to be an “unmanned aircraft” and that’s how it’s covered for commercial insurance purposes as well.
Just like any other insurance policy you purchase, a drone insurance policy will cover the costs of damage or liability to some extent, depending on what you buy. This could include replacement costs on your drone, costs for damage to property (yours or someone else’s) and even medical costs if (God forbid) there is an incident that requires medical attention.
No matter what type of policy you are purchasing, there are a few things you should always make sure you know:
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What is the limit on your policy?
In other words, how much does it cover? Is it $500,000 per incident? $1 million? Only you know what will work best for you but I’ve had clients ask and some of them have a preference (or a requirement) about how much coverage you must have.
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What is covered?
We will talk about this below in more detail, but you should know the type of coverage you are purchasing as well as what equipment is covered (if any) in the event of an incident.
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How much is your deductible?
Just like car insurance, your policy probably has a deductible. If you can afford a higher deductible in the event of an incident, if will probably make your policy premium less expensive. No matter hat your choose, make sure you can afford to pay the deductible in the event of an incident and make sure that you know what it is.
Types of Drone Insurance
Drone insurance comes in a two main forms: liability and hull.
Liability drone insurance is just what it sounds like. Think about liability insurance on your car, which protects you in the event of an accident that is your fault, liability drone insurance protects you against claims from others. And while insurance won’t necessarily protect you from being held legally liable, it can help cover the costs of an incident and any legal fallout.
Hull insurance, on the other hand, covers your drone. This is the drone equivalent to purchasing collision coverage on your car. If you run your drone into a wall and it needs replaced, you can pay your deductible and your insurance company will cover the cost to repair or replace your drone.
Like I said above, when buying your policy, make sure you understand what you are covering. You should understand that hull insurance is different than equipment or payload insurance. It is entirely possible to purchase hull insurance and not cover a camera or other payload you usually carry. And don’t forget about the rest of your equipment. When we purchased our drone insurance policy for my drone services company, we had an Inspire 1 Pro with an X5 camera. Naturally, we wanted to make sure the camera was covered, since it cost more than the drone. We also covered our extra batteries and controllers. This also included all of our equipment in case of theft.
So, if you are a filmmaker flying a drone with an external camera, you are going to want to cover it separately with equipment insurance. This is true with any additional drone equipment that you have.
What is the application like?
Also, just like buying car insurance, the application will ask you are number of questions about your experience as a drone pilot. My first drone insurance application asked me a number of questions like:
- License information
- Total drone flying time in the last 12 months
- Total drone flying time in the last 90 days
- Total drone flights
- Whether I completed a drone pilot training course
- Whether the drone would be operated “in accordance with applicable regulations” at all times
- Whether the drone would be operated over people not involved in our operations
- Type of work to be covered
- Drone insurance claim history
While the information requested from you is probably going to be a little different, these questions are all pretty normal and are just a way for the insurance company to understand the risk it is actually covering. If you are someone that has made claims on drone insurance before, it obviously wants to be aware of this. If you are a brand new drone pilot with no real flying experience, it also wants to be aware of this as well.
When you go to apply for drone insurance, it will also probably be worth it to have a set of policies and procedures in place. This is not only so that you (and everyone working with you) knows the rules for flight, but also because the insurance company will want to see that you have these rules in place. I have provided a template for these policies and procedures, which are similar to the ones that we use in my drone business.
How can I get drone insurance?
There are two routes you can take here, and depending on your situation, either one can be a perfect solution. First, you can purchase drone insurance from a “traditional” aviation insurance broker. Second, you can purchase a single flight policy (or a monthly policy!) through a drone insurance app. There are a couple of providers that we will discuss below.
If you’ve got enough business coming in, it may be worth it to purchase a “traditional” policy, but the drone insurance apps now provide such convenience (and better pricing) that our drone services company will no longer be purchasing drone insurance from a “traditional” broker.
I remember when I was first starting out flying drones commercially. I was looking to become part of a group that farmed out jobs to local drone pilots all over the country and was chastised for not having a traditional drone insurance policy because the guy running the group required it. This isn’t to say that I wasn’t insured, I had just taken an approach that fit better for me. Truthfully, our drone services company just wasn’t making enough money to justify spending $1,200 a year to cover all of our drones and equipment. Instead, we were buying a policy through a company called Verifly, which allowed us to be covered each time we flew. It cost us about $10 for an hour and worked perfectly for us.
The point of this story? Don’t let anyone make you think for a second that drone insurance through an app is not legit. It is. And it is a perfect solution for a drone pilot that is just starting out.
“Traditional” drone insurance
Like I said before, depending on the size of your drone fleet, this may be the easiest and most cost effective solution for your business at some point. Our policy was through a company called Global Aerospace. It was a $500,000 liability and hull policy that covered any Part 107 certified pilot flying for us as well as any damage to our DJI Inspire 1 Pro or our Phantom 4 Pro.
Non-traditional drone insurance
Maybe its the rebel in me, or the tech geek. But I’ve become a convert away from traditional drone insurance and a lot of that has to do with convenience. I’m going to talk about two drone insurance apps. The first is called Verifly. This service is super easy to use and the app can be downloaded for iPhone or Android. Once you have your account set up, its only a matter of opening the app when you are about to fly. You choose your flight radius, coverage time (1, 2, 4, or 8 hours), amount of insurance, weight, and when you want the coverage to begin. Then you purchase the insurance and fly. You can even add an additional insured to the policy if your client is requesting that.
The downside to Verifly at this point is that it only offers liability insurance. If you screw up your drone, you are on your own (ouch). The app recommends that you get DJI Care, but I’d rather have hull insurance. Which leads me to the second app…
Sky Watch.
Much like Verifly, Sky Watch also allows you to get liability insurance. It works the same way and allows you to select a policy with all of the same options as Verifly.
But Sky Watch far exceeds Verifly for a couple of reasons.
First, you can purchase hull insurance as well. From within the app, you can purchase insurance on your drone, cameras, batteries, controllers, etc. The only catch is that hull insurance can only be purchased on a monthly basis. Still, for a one month policy on my Inspire 1 Pro and the X5 camera, the policy was going to be $85. And that includes liability insurance as well.
Another thing that Sky Watch does is that it allows you to share your flight information with the app. Based on a number of factors, the app then calculates a safety rating for you. This safety rating allows you to get up to a 50% discount just because you are a safe pilot. This is huge.
Finally, the app actually allows you to control the drone flight without ever leaving the app.