While drone business insurance isn’t exactly required by law within the U.S.A, it’s an almost crucial part of any drone business.
The reason being that it not only protects you and your drone, but also protects others and makes sure you can cover any damage that your drone usage can do.
There are all sorts of drone insurance for all sorts of drone business activities, most of them work for both recreational users and commercial ones.
But in this article, we’ll be focusing on drone business insurance – this’ll be a complete guide on what it is, why you need it and how to get it.
As well as which types of insurance work best for each industry and drone activity, so let’s get into it!
There are actually many types of drone business insurance, but most of them are niche types that only apply in a few situations.
There are three main types of insurance:
It’s as the name suggests, hull insurance covers for damage to the drone itself.
The coverage can be written up to include ground stations, payloads, etc. as well, i.e anything else you want protected – but there is actually a specific payload insurance which we’ll get into in a bit.
To understand it, look at like warranty programs that many drone makers offer like DJI Care for example.
Usually, when you’ve got a pretty low end drone, hull insurance can be unnecessary, since in most cases the insurance’s deductible would be close to or over the replacement cost. Most drone insurance deductibles are around $500.00.
But, if you have a higher end drone then protecting that investment is a no-brainer really.
Ideally, any drone that is worth over $1500 will need hull insurance – the more of a novice pilot you are, the more you’ll need it since you’ll likely crash your drone a few times at least.
So while Hull insurance is for your equipment, there is another type of insurance available, only this one is highly recommended. That’s liability insurance!
Liability insurance for your drone is very similar to that on your care. It cover damage to other people’s property, or in worse situations, an injury that your drone may cause (although a rare case).
As a commercial pilot, you’ll want to have a liability insurance as it’s crucial. Not only for ethical reason, but also because most companies will require it prior to you ever launching on their sites or performing work for them.
Usually, you can choose the amount of protection (coverage limit) on your drone business insurance. It’s typically between $500,000.00 and one million.
The amount of coverage you decide on will be dependent on the type of work you plan on performing.
The reason why liability insurance is highly recommended is because sometimes It can be very possible for the damage to exceed an amount that you’re able to pay. Depending on where you fly and what you may crash into, the costs of repairs can actually ruin your life.
This is the third most common type of drone business insurance, and it’s usually aimed at your drone’s payload.
If you’re not flying a large drone capable of carrying something valuable, then you can skip this part. If you are however, then read on…
Expensive thermal, multispectral, or cinematography cameras… gimbal systems… other pieces of tech? Some of these can easily exceed the price of the drone itself. Protecting your payload can sometimes be just as important as protecting your drone.
Another cool thing about payload insurance is that it can be set up to cover theft as well!
Yes and no, because while it’s not exactly illegal to not have insurance, if you’re running a drone business you’ll most likely have to.
There is no law that requires you to have drone insurance if you use one for business or recreational purposes. But if you’re using a drone for work-related purposes, you’ll want to consider getting the best drone insurance policy.
The reason why drone insurance (escpecially liability insurance) is important is becase if you cause accidental property damage or injuries to someone else while operating your drone for work, you may have to pay out-of-pocket for repairs, medical bills and lawsuits – if you’re covered however, you won’t need to have a thing.
There is also something else to consider, since you’re running a drone business.
If you run a business, most of your clients WILL require you to have drone insurance if you use a drone for a project. If you don’t have drone insurance, they won’t won’t hire you.
You can read up more on general liability insurances and why most businesses need it over here.
And as usually, UAV coach have done a great video explaining exactly why you might need a drone insurance (even though legally you don’t):
And if you are looking for a drone business plan guide, you can check my other article in which I've explained everything in detail.
It varies greatly on the insurance provider you use, and on the type of insurance – sometimes even the drone activity can play a role (since some are riskier than others).
A typical commercial-use drone insurance policy can cost as little as $563 a year for $1 million in liability coverage. Adding hull or physical damage coverage for the drone or its equipment will add about 10% of the hull amount to your premium.
How much you’ll pay for drone insurance depends on several factors. Factors like:
The answer to this question will obviously depend on the policy of your insurer and what demands they have.
However, there are some things that could happen that might provide a good enough reason for your insurer to deny coverage.
There are behaviors or actions that you are personally responsible for that could be defined as exclusions in your insurance policy.
For example, failing to register your drone’s serial number or failing to display the proper identification numbers on your drone…
Or if you fail to log your flights, your insurer might not offer coverage – some insurer’s do ask for your flight log.
While there are many insurer’s for drone businesses out there, some of them stand at the top. If you’re running or planning to run a drone business, I recommend checking these insurance companies below:
As a drone photographer, there mainly two types of insurances you’ll need – hull insurance and payload insurnce (with liability insurance being a default).
The reason for that is simple, as a photographer you’re either using a higher end drone, or you’re using expensive payload on your drone to film.
So here are the insurance companies I’d recommend for that:
Avion is probably the best our there for weddings, events and really just drone photography in general, based on their specialization on commercial policies.
Including policies that cover aerial photography, an important component for so many weddings and other events!
Pros:
Cons:
You’ve more than likely heard of Skywatch.ai – it’s the top pick for many drone business owners simply the for flexibility it offers pilots. You can buy an annual plan, purchase coverage by the month, or buy a drone insurance policy for short bursts of time—even by the hour (or minute!).
This means you can go to a project site, and purchase insurance on the fly (pun intended).
Pros:
Cons:
And by this I mean anything from land surveying to agriculture mapping and power line inspections, etc…
So you know that the most important drone insurance you’ll be after in this case is liability insurance (since things could go wrong easily in these types of projects).
Here are my top picks if that’s your activity:
BWI Fly insurance are known for their high coverage limits due to the fact their drone insurance policies come with full liability coverage with limits from $500,000 to $25 million, which is higher than any competitor.
Pros:
Cons:
The reason I’d recommend BWI Fly is simply because you can purchase coverage limits in extremely high amounts up to $25 million, something many employers would love to see.
It’s also a company with history, since they were founded back in 1977 – so you know they’re legit.
You the option to tailor your policy to your needs, which is crucial in the world of drones where all kinds of shapes, sizes, and purposes for drone use must be taken into account.
You can purchase hull coverage that pays for physical damage to your drone as well as attached equipment, and current limits for physical damage can range from $800 to $500,000 – so if you have an expensive drone and payload, BWI Fly is perfect for you.
United States Aircraft Insurance Group (USAIG)
This is pretty similar to BWI Fly, only a little more geared towards big and established drone businesses. They work with some of the biggest aviation companies as well.
Pros:
Cons:
Only consider this company if you’ve got a medium to big sized drone business, as they don’t even give free quotes. You’ll have to speak to an agent and go through a long process before they decide whether to work with you or not.
Let’s say you’re abroad, and trying to work on a project yet don’t have coverage in said country.
You don’t have the time to look for insurance companies in the country you’re visiting, and have to go through their verification process.. So what do you do?
This is where insurance companies who offer international coverage come in – and I’ve got just the one for you!
Coverage from DroneInsurance.com travels with you wherever you go, although some territories are excluded based on their local regulations regarding drone use.
Pros:
Cons:
So there you have it! I hope you understood exactly what drone insurances are, and why you need them after going through this article.
Keep in mind that I only wrote for drone business owners. If you’d like to check out the hobbyist version, then check out this previous article I’ve written.
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