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UAV Insurance Group On Facebook!

Discussion in 'General Discussion' started by AviationBroker, Aug 25, 2016.

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  1. AviationBroker

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    Hello,

    I have started a group on Facebook that focuses on commercial UAV insurance. It is called "Drone Insurance 101." If you would like to be more educated on the ins and outs of UAV insurance, please join the group. I have included a link below.

    drone insurance 101 的个人主页 | Facebook

    Thanks,
    Joe Ernster

    Bullock Agency, Inc
    1433 Lancaster Ave
    St. Charles, IL 60174
    Office- 630-377-9499
    Cell- 630-864-7979
    Fax- 866-871-0375
    Email- joe@bullockagency.com
    www.BullockAgency.com
     
  2. AviationBroker

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    I am not sure why the link shows up like that. If you do not want to use that link, simply search "Drone Insurance 101" on FB under groups.
     
  3. AviationBroker

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    Hello,

    I have started this thread in order to generally discuss UAV insurance. Many commercial UAV operators think that a "standard" commercial general liability policy will protect them and their business. However, 99% of "standard" insurance polices exclude everything related to aviation. So, to begin this thread, I have elected to post the basics of UAV insurance. Feel free to add input or ask questions.


    Are you thinking about becoming a commercial UAV pilot under FAA part 107? If so, UAV insurance should be a main concern of your new business. A vast majority of "standard" liability insurance policies exclude anything that has to do with aircraft. Since UAVs are under the purview of the FAA, they are considered to be aircraft by most insurers. So how do you get your new UAV operation insured? Easy, contact an aviation specific insurance broker (I happen to be one). If this sounds intimating, you are not alone. However, once you understand the basics of insuring an aircraft, you will be an aviation insurance wizard.

    The base policy in the aviation insurance industry is liability only. The limits on liability only policies range from $500,000 each occurrence all the way up to $5,000,000 each occurrence. However, if higher limits are needed, they can be negotiated. This liability coverage will protect you from any Bodily Injury or Property Damage claims that may arise from your operation of your insured UAV(s). Fly through a window while shooting a real estate video and land on somebody's grand piano? Covered. Hit a passerby and cut their finger? Covered. After you have purchased liability coverage, and are looking for more protection, you can then add "hull" coverage to your policy with some of the aviation insurance companies.

    Hull coverage is physical damage to your UAV itself. This is a "Stated" or "Agreed" value. Let us say you have a basic DJI Phantom 3 Professional that you have insured for $1000. You slam this aircraft into a tree and completely destroy it. The insurance company takes a look, sees that it will not be feasible to repair it, and they deem it a total loss. In this scenario, you would get a check for $1000 minus any applicable deductibles ( UAV deductibles are usually 5% - 10% of the insured value of the aircraft). Same logic applies to any other UAV. However, if you have an inspire 1, with a very expensive upgraded camera, you would want to "schedule" the aircraft and the camera separately. The upgraded camera can be added to most UAV insurance policies as "payload" equipment.

    Liability and Hull coverage are the main coverages that you should be concerned with as a commercial UAV operator. There are some other "ancillary" coverages that I will address in future posts.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
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  4. SanCap

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    Hi Joe, I am insured thru you with liability and hull coverage. I know I asked this question and forgot the answer but what happens if my Inspire crashes into the ocean and is not recoverable?
     
  5. AviationBroker

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    SanCap,

    I hope you are well and thank you for joining the thread!

    If your aircraft crashes into the ocean and is unrecoverable, you will get a check for the insured value minus any deductibles. Earlier in the year I had a customer that flew his UAV into the top of a redwood. It was not recovered and he had a check in hand within the week. Same company as you. However, this may not be the case with all companies.

    Thanks,

    Joe Ernster
    joe@bullockagency.com
     
    SanCap likes this.
  6. SanCap

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    Thanks for clearing that up for me.
     
  7. AviationBroker

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    Can I get a UAV insurance policy that covers me while I am outside of the USA?

    Yes. Before you buy a UAV insurance policy, make sure that you review the "Policy Territory" section with care. Each company has their own covered territory. Some are more broad than others. Be sure to let your broker know that you need to be covered in a specific territory. Also, Mexico and Canada have been known to have some very serious aviation insurance regulations. So, like anything else in life, do as much research on local regulations before flying in unfamiliar regions or countries. We have seen more than one aircraft be "nationalized" by the Mexican Government.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  8. AviationBroker

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    What if I am a UAV dealer or manufacturer? How can I protect myself and my business, Joe?

    Another great question. You can purchase what is called "Products and Completed Operations coverage. This coverage will protect you and your business in the event of a property damage or bodily injury claim against you that is associated with a UAV that you manufactured, sold, or serviced in the past. This is an invaluable coverage for anyone involved in UAV sales, service, or manufacturing. If you sold a UAV to a production company that subsequently had an large accident, not only would the production company be named in a claim, so would the manufacturer, distributor, repair company, and their mothers. As soon as attorneys get involved, anyone who looked handled the UAV in the past is a potential target.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  9. AviationBroker

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    What is an "Open Pilot Warranty"?

    UAV insurance policies are written in one of two ways; Named Pilots Only or with an Open Pilot Warranty. A Named Pilots Only Policy is exactly as it sounds, only pilots who are specifically named on your UAV policy can operate the aircraft and be covered. An Open Pilot Warranty allows pilots that meet certain criteria operate your aircraft under the insurance policy. Most of the time with UAV insurance policies, an Open Pilot Warranty would say "Any Operator As Approved By The Named Insured." Open Pilot Warranties, often called an "OPW," are not offered by all UAV insurance companies. Please read your policy carefully to understand who is actually covered when operating your aircraft. The number one reason a claim would be denied is because an "unauthorized" person was piloting the aircraft.

    Thanks,
    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  10. 46chief

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    I want to to purchase liability only insurance for my Phantom 3 and my back-up Phantom 3, I also want to insure an Inspire when I purchase one in the near future.

    this is what my quote looks like:
    DJI Phantom #1 $995
    DJI Phantom #2 $695
    DJI Phantom #3 $395 total all 3 $2,085

    I find this way too expensive for my needs at the moment, I am a single pilot operator, I can only fly one at a time.

    What would make sense is to insure my operation like they would a contractor. I see these aircraft as tools and if I were a contractor and had to pay an upcharge for every additional nail gun, air compresser, or ladder I need to do my job I would walk away.

    Is there an insurance coverage that covers liability for the business and not the ridiculous notion that if I have three aircraft I'm making three times the money?
     
  11. AviationBroker

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    46chief,

    This has been a very common complaint from UAV operators. However, this is the way that aviation insurance works. You must schedule and pay for each UAV that you would like to insure. I insure manned aircraft guys that own 5 airplanes, They have to pay for the insurance on each one. From experience, I know that quote came from United States Specialty Insurance Company (USSIC/Tokio Marine/HCC). That is currently one of the best deals out there for UAV insurance from a reputable aviation insurance company. I have been approached by some companies that offer "blanket coverage" for UAV operators. However, the companies that I have seen offering those policies have all bee "non-admitted." We do not do business with non-admitted companies and I would steer clear of them if I were you.

    Think of UAV insurance like auto insurance. I own two cars, I can only drive one at a time, but I must carry liability coverage on each one separately.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  12. 46chief

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    The issue with your comparison and the industry model I'm having is these are sub 5lb toys with great cameras. Not Cessnas, and Fords. They cannot carry people and the damage they can cause is minimal in most cases. It is asinine to treat these like manned vehicles, they are tools. A photographer who purchases liability isn't charged for every camera and lense he owns.

    I need blanket coverage for my survey business and not to be taken advantage by companies who are charging manned aviation prices for a tool.

    The other issue I have is If I crash a phantom, I send it back to the DJI for repairs. They usually just send me back another refurbished one, so now I'm responsible for tracking serial numbers and making sure I update that info. and if it isn't done properly the adjuster will deny any claim with any excuse they can use.

    If this is the way Aviation insurance works then we need to move away from them and get the people who insure construction contractors, photographers or filming companies to step up and offer us a fair and cost effective product.
     
  13. AviationBroker

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    46chief,

    I definitely understand where you are coming from. However, the FAA views these UAVs as aircraft and they being insured by aircraft insurance companies. These companies have been insuring manned aircraft for over one hundred years. They know the risk they are taking with their business when they insure a 56 year old private pilot in a Piper Arrow. They just do not have the data when it comes to insuring UAVs since this industry is so new. The actuarial data is just not there. If this turns out to be a low risk industry, rates will decrease. However, if commercial UAV businesses start having a large amount of claims, premiums will increase. I am sorry that you feel they are taking advantage of you.

    As far as claims handling is concerned, I have had about 9 UAV insurance claims this year. They have all been handled in a VERY timely matter and my clients were satisfied with the service. A couple of the claims were actually settled via email and the adjusters did not even visit the client's location. I am very confident in the claims handling abilities of these companies.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  14. AviationBroker

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    What is "Non-Owned Payload" coverage?

    Non-Owned Payload coverage is exactly as it sounds. If your UAV ever carries a payload (camera, banner, sensor, etc,) that is not owned by you or your company, it would be a good idea to get Non-Owned Payload coverage added to your policy. When requesting this coverage, please let your broker know if the owner of the Non-Owned Payload carries any insurance on the payload to be carried. Knowing this may encourage the underwriter to provide a lower rate for you. Please keep in mind that this coverage is not offered by all insurance companies.

    Thanks,

    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  15. AviationBroker

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    Is there any coverage for invasion of privacy?

    UAVs often get a bad rap from the general public and the media. Many people think that the sole purpose of a flying camera is to spy on them (many people I know). However, we all know that is not the case. What can you do to protect yourself and your business from people claiming that you have invaded their privacy? Well, some UAV insurance companies can add Invasion of Privacy coverage to your UAV insurance policy. Some companies charge extra for this coverage, some offer it for free, and others do not offer it at all. If you are concerned about invasion of privacy allegations, ask your UAV insurance broker (hopefully me) if Invasion of Privacy coverage is available to you.

    Thanks,
    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  16. AviationBroker

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    What happens at renewal time?

    Aviation insurance policies do not automatically renew. Your broker should contact you prior to your renewal and make sure nothing has changed with your risk or desired coverage. The broker, if they are good, will then submit your information to all of the UAV insurance companies out there. If you know that you want to change your coverage prior to your renewal, please let your broker know as soon as possible. Also, since aviation insurance works on a first come, first served basis, please try not to contact other brokers for quotes. They will end up blocking your current broker from obtaining the proper quotes which will cause a huge headache for you and your current broker. If you feel that your broker is not getting you the proper coverage or the best rates, simply let them know. Being fully transparent with your aviation insurance broker makes everything go more smoothly for everyone involved. If you have more than one broker getting quotes for you, it creates a "too many cooks in the kitchen" situation.

    Thanks,
    Joe Ernster
    Bullock Agency, Inc.
    joe@bullockagency.com
     
  17. Cactuswest

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    Is it possible to insure your drone per job?
     
  18. AviationBroker

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    Cactus,

    The policies that I offer are written on an annual basis. I cannot provide insurance on a per job basis.

    Thanks,

    Joe Ernster
    joe@bullockagency.com
     
  19. Cactuswest

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    No worries, I thought I'd check this box off.
    Although I think the film industry offers per job insurance. It might be something worth looking into. You would probably get more business.
    From an operator viewpoint, it is more manageable this way. You can quote a price to your client including the job insurance cost. Everybody wins.
     
  20. AviationBroker

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    Cactus,

    I wish that I could influence the offerings of the insurance companies. However, I am only a lowly broker and have no say. Thank you for the insight though.

    Thanks,

    Joe Ernster
    joe@bullockagency.com
     
    Cactuswest likes this.