UAV Best Practices and Insurance

With the passage of Part 107 of the FAA regulations, which spells out new and in some instances relaxed rules for commercial operation of unmanned aerial vehicles (UAVs), the market for UAVs, including the military, commercial, and personal use markets is projected to grow exponentially.  The FAA cites industry estimates that the new UAVs rules could result in more than 100,000 new jobs and $82 billion for the U.S. economy over the next 10 years.  Along with the increased opportunities for commercial UAV operations come increased risks.  A commercial UAV operator's risks aren't limited to penalties from the FAA for exceeding allowed UAV usage.  A UAV could crash into a crowd of people, damage a building or crash into a manned aircraft, injuring those aboard. Managing these risks is becoming critical to commercial UAV operations.

The leading international insurance organization AIG recommends that essential first steps include establishing commercial best practices for UAV operations.  This begins with focusing on three areas:  (1) best practices for the UAVs you control directly; (2) best practices for contracting with a third-party who controls UAVs for you; and (3) best practices regarding those UAVs you don't control at all.  On its website at www.AIG.com, AIG provides a detailed template for formalizing best practices for commercial UAV operators.

Next, it will be important to obtain insurance covering commercial UAV operations.  Such insurance would provide coverage for liability to persons or property arising from UAV caused injury, to insure the UAV against damage to its airframe and components.  A number of insurers, such as AIG, and insurance brokerages, such as Global Aerospace, are now providing such insurance coverage.

Along with the explosion in new opportunities for commercial UAV operations comes increased risks.  Plan ahead.  Establish best practices for commercial UAV operations and manage exposure with appropriate insurance.