We explore this question on this episode of the Drone Radio Show with Grant Goldsmith president of Overwatch a division of Avalon Risk Management Company. Overwatch specializes in high risk insurance for the U.S. government, United Nations, NATO and international commercial contractors working globally. The company also provides insurance for the commercial drone industry. Grant has more than 20 years of insurance and transportation experience. He talks about the benefits of drone insurance and why commercial operators might want to think about adding coverage to protect their business.
- [01:22] Intro to Overwatch. Overwatch is an insurance brokerage that specializes in drone and aviation insurance.
- [02:33] Overwatch Entry Into Drone Insurance. Overwatch has traditionally focused on high risk insurance underwriting associated with war zone risk in Iraq in Afghanistan. As the commercial drone industry took flight, extending coverage to commercial drone operators was seen as a natural move for the company.
- [03:08 ] Type of Drone Insurance. Grant discusses the types of coverage that is available to drone operators – liability insurance and insurance for the operator’s drone. Much like what individuals would carry for their car.
- [03:44] Pricing. Pricing of insurance has changed dramatically in the past few years coming down to about $900-$1100 per year for a million dollars in liability.
- [04:49] Case For Drone Insurance. Two reasons to get insurance – get the right coverage to protect their business and to pursue doing business with other parties.
- [07:40] Impact of Federal Regulations. Section 333 approval and a record of operating drones responsibly would be positive in securing drone insurance at favorable rates, A good safety protocol and good operating procedures will affect your coverage.
- [10:17] Buying Drone Insurance. Business operators should begin thinking about drone insurance when they set up a business. Business owners can purchase drone insurance through license brokers.
- [13:32] Size of Businesses Seeking Insurance. All sizes of businesses are seeking drone insurance, with the larger commercial companies that have a Section 333 exemption being most interested. Smaller companies are looking for something effective and affordable.
- [14:32] Type of Claims. Very few claims have been made, but the most that are being seen are rough landing claims, where operators momentarily lose control of the ground station. The other claim that is often seen is drones that lose link and never return.
- [16:50] Insurance for Recreational Drone Users. Recreational drone users can get coverage through the American Modelers Association.
- [17:36] What Underwriters Look For. The main points that underwriters think about as they decide to write and price risk is where drones are being used, the track record of the user and operator qualifications. It underscores the need for commercial drone operators to develop their own safety protocols and to demonstrate that they’re implementing those safety protocols on a daily basis.
- [21:53] Venue Insurance. Insurance is available to events if it is of significant size. Event managers are also encouraged to contract with drone operators that have drone insurance.
- [26:27] Final Comments. Drone insurance is affordable and no reason not to consider it if you’re in business.
- [27:00] Closing
- Overwatch (www.riskoverwatch.com)
- Are Drone Accidents Covered by Insurance? (December 25, 2015)
- Flying a Drone? You May Need to Buy Insurance (December 18, 2015)
- Three Best Practices For Insuring Drones This Holiday Season (December 17, 2015)