Sorry about being vague in my last post, as my posts occasionally get deleted when I mention the name. Therefore, let me give you a brief rundown about drone insurance. First off, I'm a licensed 107 drone operator, manned airplane pilot (Commercial, Multi, & CFI), and 18-year aircraft insurance Underwriting Executive.
There are multiple options and sources to obtain drone insurance and depending on your operation and may require different avenues to do so. These options are:
1) Use an insurance broker to obtain an annual drone policy from an aviation carrier or general liability carrier.
2) Add coverage to an existing business policy or homeowners policy depending if you are operating commercially or for recreational purposes. Some policies may exclude aviation or drone operations and other do not.
3) Use a usage-based drone insurance app to obtain insurance per hour, daily, monthly, or annually. This can be useful and a better option for cash flow purposes instead of putting up a large some of money out of the gate. There are only three options at the time of this post: AirModo, Skywatch, Droneinsurance.com
Let’s focus on option #3 above for now. Although on the front end these mobile apps may all seem similar, there are differences that may or may not be important to you. Skywatch is a tech company and insurance broker who places business on your behalf with one specific aircraft insurance company. Skywatch built their own app and manage it on a daily basis. They can change insurance carriers whenever they want and make money by taking a percentage commission from policies sold.
AirModo was developed and is owned by an insurance company. There are no third parties taking commissions per se and is somewhat a different business model then others. However, on the front end a user may not care if there is a broker involved or not. Plainly put premiums tend to be less as they don’t have another mouth to feed. AirModo is available to both commercial users up to $25 million in liability limits and $2 million for hobby / recreation users. Only liability options are currently offered, and therefore you are not able to insure 1st party drone damage. This may be a showstopper for some but I’ve only seen about 30% of drone operators buy 1st part physical damage coverage since 2016.
Droneinsurance.com is a third-party website company using a general liability (not aviation specific) insurers paper. There are additional fees (such as surplus lines fees) added to your policy premiums because of the way they are set-up.
Recently, one usage-based drone insurance app, Verifly, closed their doors. They too were a tech company (aka Thimble) and an insurance broker placing business with one specific carrier. This has left many drone operators looking for drone insurance quickly in order to satisfy certain jobs they have committed to.
Long story short is that there isn’t a one size fits all option for drone insurance. It largely depends on your size of operation, cash flow situation, and how often you need insurance. From my vantage point, I suggest using an aviation type insurer as they have written manuscript policies specific to drone operations and know how to handle aviation type claims. Your average homeowners or business insurers have no idea what a drone is or what you do with them.