Things to consider when selling commercial drone insurance

Bryan Verpoort of ITOO says the only viable way to insure drones is to specify that they be properly registered and flown by trained pilots.

“Many insurance companies and brokerages have seen their loss ratios suffering as a result of underwriting drone insurance where unlicensed leisure operators are involved,” he says. “At ITOO we have opted for the formal route, insisting that drone owners are registered and pilots are trained through the Civil Aviation Authority. Without regulation it’s simply a free-for-all, which makes accurate underwriting practically impossible.”

So what should a broker look out for when selecting the best drone insurance policy for a commercial or business client? Here are Verpoort’s top three criteria:

Remote operator’s licence

The insured should hold an operator’s licence issued by the Civil Aviation Authority.

“Flying a drone for commercial purposes is effectively a form of aviation and as such is subject to the legislation and regulations that guide aviation insurance,” he says. “So like airline pilots and operators need a licence, so too should commercial drone operators.”

One of the conditions of the remote operator’s licence is that the holder must be insured.

Remote pilot’s licence

Having a qualified pilot at the helm (or, in this case, at the remote control) reduces the likelihood of an event occurring as a result of operator error.

“CAA-certified pilots who have been trained at a reputable, accredited flying school are far less likely to be involved in accidents, and therefore present a more attractive risk profile,” says Verpoort. “We can therefore insure them at a far lower rate, which works out well for everyone concerned.”

ITOO has a close association with Pro-Wings Training, the only organisation in Africa that offers both theoretical and practical training for national, commercial, private and remote pilots’ licences.

“Through this relationship we hope to elevate the standard of commercial drone pilots throughout the country and north of our borders,” says Verpoort.

Comprehensive cover and product extensions

The ITOO drone policy is unique in that it offers comprehensive cover, focusing on the hull as well as the entire spectrum of liability, including third party loss of sight and cyber-related risks.

“Multi-rotor drones can present a threat when flying at face height, and we have cover available to protect operators personal injury in this regard,” explains Verpoort.

“We also cover cyber-related risks that arise out of the data collected by the recording equipment that drones carry. This data can be sensitive at times, depending on what the drone is being used for – think border protection, coastal patrol, crime scene inspection, anti-smuggling operations, inventory control, for example – and is vulnerable, to extortion and ransom, among other things.”