When we first wrote about drones a number of years ago, they were the hot new thing. Parents were buying them for their children as well as themselves, and concerns revolved around privacy and interference in commercial airspace. There were incidents of drones flying into buildings and the hope that drones could be useful when adjusting claims, in search and rescue missions, and many other activities beneficial to society. One of our first questions back in 2014 was whether drones were aircraft. The Federal Aviation Administration refers to drones as Unmanned Aircraft Systems, or UAS. A lot has changed. So where are we now?
In 2014, ISO created exclusion forms CG 21 09 06 15, Exclusion Unmanned Aircraft and CG 21 10 06 15, Exclusion Unmanned Aircraft (Coverage A Only) that define drones as "unmanned aircraft" designed to be controlled by a person not in or on the aircraft, and excludes coverage for such craft from the CGL policy. Along with the exclusion, these limited coverage endorsements were also created: CG 24 50 06 15, Limited Coverage for Designated Unmanned Aircraft and CG 24 51 06 15, Limited Coverage for Designated Unmanned Aircraft (Coverage A Only). These endorsements provide coverage for scheduled drones that are used for a specific project that is also listed on the schedule.
In 2015, ISO developed an inland marine form that can be added to the contractors equipment, machinery and equipment, and miscellaneous articles coverage forms. This form, Limited Coverage for Unmanned Aircraft Property, IH 99 29 allows the insured to schedule the drones onto the policy for specified amounts, as well as blanket coverage. Coverage is for physical damage under specified conditions. The IH 00 61, Unmanned Aircraft Property and Cargo Coverage Form covers damage to drones, essential equipment used with drones, and cargo owned by the insured when carried as part of the operations.
It wasn't until 2017 that ISO created an endorsement for the homeowners policy, Aircraft Liability Definition Revised to Remove Exception for Model or Hobby Aircraft, HO 34 02, revising the aircraft liability definition to remove the exception for model or hobby aircraft. A separate exclusion exists, Personal Liability Injury for Aircraft Liability Excluded, HO 34 03. There are some state specific endorsements excluding personal injury for aircraft liability.
Three new endorsements for commercial liability are effective in December 2019. They are:
- Limited Coverage for Designated Unmanned Aircraft, CG 34 20 to be attached to the Owners and Contractors Protective Liability Coverage Part;
- Exclusion – Unmanned Aircraft, CG 34 21 to be attached to the Railroad Protective Liability Coverage Part; and
- Limited Coverage for Designated Unmanned Aircraft, CG 34 22 to be attached to the Railroad Protective Liability Coverage Part.
The limited coverage endorsements both require the UAS to be scheduled on the form, along with a description of the operation or project for which the drone is being used. The CG 34 20 describes loading or unloading, and applies an aggregate limit to coverage if an aggregate limit is shown in the schedule.
The CG 34 22 also describes loading and unloading and an aggregate limit, adding an exclusion for damage to property arising out of the ownership, maintenance, use, or entrustment to others of any aircraft that is an "unmanned aircraft".
The CG 34 21 excludes unmanned aircraft under Section I, Coverages A and B. This excludes property damage and liability from the use of the drone. This endorsement defines loading and unloading and unmanned aircraft.
From the outset, one of the crucial issues with UAS was interference with commercial and governmental airspace. Soon after their release to the public, drone sales grew swiftly, and the FAA was concerned about airspace and keeping drone pilots out of the path of commercial aircraft traffic. First, the FAA had to distinguish between hobby aircraft and UAS, and then develop requirements for flight. The FAA defined three types of operations: civil, public (governmental), and model. Drone pilots were required to register their drones with the FAA.
In 2016, regulations were created for non-hobby and non-recreational drones as more businesses found use for them in their operations. Drones were regulated by weight, speed, time of day, and operation by a remote pilot. Pilots were required to have a remote pilot airman certificate with a remote UAS rating. In January 2018, the FAA Reauthorization Act was revised and several sections refer to the proper flying of UAS. Representatives of UAS interests are included on many aviation advisory committees. //www.congress.gov/115/bills/hr302/BILLS-115hr302enr.pdf
Recreational flyers are required to register their drone with the FAA, mark it on the outside with its registration number, and carry proof of registration when flying the drone. Users are required to fly only for recreational purposes and follow the safety guidelines of a community-based organization. There are mobile apps that inform pilots of areas that are restricted airspace. Flying in controlled airspace is not allowed except for certain circumstances, and lists of certain approved sites are available. A new law will require operators to pass an online aeronautical knowledge and safety test and carry proof that they passed the test. The FAA is rolling this out in increments, but the law was passed in May 2019. The eight following conditions exist for recreational flyers.
- The aircraft must be flown for recreational purposes only.
- The aircraft is operated in accordance with or within the programming of a community- based organization's safety standards; the standards being developed in coordination with the FAA.
- The aircraft is flown within the visual line of site of the operator or a secondary observer in direct communication with the operator.
- The aircraft is flown so that it does not interfere with and gives way to any manned aircraft.
- In controlled airspace, the operator obtains prior authorization from the administrator or designee before operating in said airspace, and complies with all restrictions and prohibitions.
- In uncontrolled airspace (space without FAA control), the aircraft is flown no more than 400 feet above ground level and complies with all regulations/prohibitions.
- Operators have passed an aeronautical knowledge and safety test and maintain proof of passing to be made available to the administrator, designee, or law enforcement personnel upon request.
- The aircraft is registered and marked, and proof of registration is made available to the administrator, designee, or law enforcement upon request.
Drones may also be flown for business purposes, and there are many using them to take video of properties for real estate sales, web page advertisements, weddings, and other social events. Flying a drone for business requires a Remote Pilot Certificate and registration of the drone with the FAA. Among the restrictions for using drones for business are that drones must:
- weigh less than fifty-five pounds,
- be within visual line of sight of the pilot,
- not fly over persons, under a covered structure, or inside a covered stationary vehicle, and
- not fly more than 400 feet off the ground, over 100 mph airspeed, and only during the day.
Waivers may be available for some operations. Information on the requirements and waivers may be found on the FAA websites. //www.faa.gov/uas/media/Part_107_Summary.pdf https://www.faa.gov/uas/commercial_operators/
A recurrent safety problem with drone flyers is interference with emergency personnel. The National Interagency Fire Center states that aerial firefighting efforts have been shut down nine times this year and that at least twenty other drone incursions have hindered firefighting operations from January through October. Aerial firefighting efforts can significantly slow the spread of a fire. A fire can grow exponentially in twenty minutes and two recent interferences stopped airdrops for forty-five minutes and one hour, respectively. Planes dropping water dip as low as 150 feet above ground when dropping the water, giving little room to safely land if a drone strikes them. Bird strikes are bad enough, but drones are plastic and metal and can do more damage. In California, firefighters are allowed to destroy drones that are hampering their efforts, and there are penalties for those drone pilots.
Recently, the FAA announced new airspace restrictions over sixty facilities, mostly federal prisons, as deliveries were trying to be made to prisoners or drones were otherwise interfering in federal operations. Drugs and cell phones are popular paraphernalia that have had delivery attempts made to prisons, or even over the southern border.
The ability of drones to deliver packages is one of the benefits of drones. While regular package delivery is still a long way off, Amazon has been working on developing a drone delivery program for quite some time. Not only can household goods be delivered, but medications can be delivered to remote area, or areas that have sustained a disaster and are short on medical supplies and personnel. Walgreens has a delivery service starting in Christianburg, Virginia, and Uber is working on an Uber Eats delivery program where food will be delivered to a staging area for drivers to deliver food to customers. UPS delivered two packages from a CVS store in Cary, North Carolina last Friday. One of the problems with delivery is access to the delivery point; lack of a back yard, small mailboxes, and other items factor in to making delivery not the door-to-door action anticipated. Amazon may have a delivery system in the coming months, and microbots called RoboBees may help with pollination, search-and-rescue missions, surveillance, and other tasks.
News agencies may use drones for traffic reporting, and police may use drones for crime scene mapping, serving warrants, responding to 911 calls, and other scenarios. This creates the potential for millions of drones to be flying through the air. With large numbers of drones in the air, collisions, dropped packages, drones crashing into buildings or people, and other problems become more likely. The FAA already receives more than 100 reports monthly involving drones, so controlling drone traffic will become more important. With the predicted volume of drones, automation of a flight control system will be critical. Monitoring existing restricted airspace and the unrestricted areas drones commonly fly in will be difficult. NASA is currently researching unmanned traffic management (UTM) systems to create safe, low-altitude traffic operations.
UPS has been certified to scale its delivery system beyond its testing sites in North Carolina. The type of drones being used were used by the Swiss postal service in 2015 and in medical delivery in 2017. These drones can carry packages up to five pounds, over twelve and one half miles beyond visual line of sight, and over people. It is allowed to deliver onto campus settings, such as hospitals and universities, but cannot yet deliver to residences.
From the beginning, drones have been used to provide assistance in rescue operations. Between May 2017 and April 2018, sixty-five people were saved by drones, twenty-two of whom were in grave danger. The ability to attach a thermal imaging camera to a drone to assist in finding people can be key in finding people after dark or those who have tried to take shelter under brush or other obscure areas. As more public agencies, such as firefighters, police, and other emergency personnel, adopt the use of drones, the more drones can help rescue those in dangerous situations. In September, police in Daytona Beach, Florida used a drone to determine whether a grenade that a person was threatening to set off in a hotel room was operational. Knowing that the grenade was a dummy grenade allowed the police to end the situation safely. The Daytona police have had a drone unit since 2017 and have used it to help capture a murder suspect, assess damages after Hurricane Irma, watch over large events, and other day-to-day uses.
Passenger vehicles are not the only things headed towards autonomous operations; autonomous drones are being developed, as well. An autonomous drone would be ideal for mapping, inspections, and many other uses. As with vehicles, these early autonomous drones are highly restricted, but show what will be possible in the future.
Privacy has long been an issue, and there have been situations where a homeowner shot down a drone that was over his yard. In 2015, a Kentucky man shot down a drone and was charged with criminal mischief and wanton endangerment. A later federal lawsuit filed against the man in 2017 was dismissed. Other incidents involving a person shooting a drone down resulted in the shooter being arrested. The FAA made it clear in 2016 that shooting at any aircraft, including drones, was a safety hazard and a federal crime. It is a felony and carries a penalty of up to twenty years in prison. Drones have been flown near the White House, in commercial airspace, at emergencies such as wildfires, and more. However, a recently proposed bill would make the airspace up to 200 feet in altitude over private property under the control of the property owner, thereby restricting the FAA's ability to regulate that airspace. This would make zoning for that area the responsibility of the state or tribal entity governing the land. Depending on how states would choose to establish regulations, shooting down drones over one's own property could become legal. The bill must first pass, so there is a long way to go yet.
Recently, the Ford Motor Company filed a patent for a drone that would launch from a vehicle's trunk and provide emergency services when a vehicle breaks down or help rescuers find vehicles that have gone off-road and are difficult to find. The drone could shine a light, provide GPS coordinates, turn on a siren, or provide other services.
Drones can be incredibly useful in handling claims, particularly in catastrophic situations. On average, it takes drones twenty to thirty minutes to fly the entire surface area of a home for a claims investigation. Drones provide a clear view of damage, and keep adjusters safe by allowing them to stay on the ground instead of climbing onto roofs. Likewise, drones can go into damaged buildings that would be unsafe for adjusters, or into areas with hazardous chemicals that have not been cleared for entry. More and more carriers are using drones in their claim practices.
Unfortunately, the public image of drones is less than positive. The reports of drones at airports causing flights to be canceled, hampering firefighting efforts, and threatening privacy puts drones in an unfavorable light. In June, it was reported that less than one third of U.K respondents to a survey felt positive about drones.
While ISO has developed some standard endorsements, many carriers are developing policies specifically for drone risks. SwissRe has a sample policy for review at //cdn.shopify.com/s/files/1/0021/6380/2210/files/Sample_Commercial_Policy_Wording_V2.pdf, and uavcoach.com provides a guide on what to look for in a drone insurance policy, along with a list of providers.
A unique approach to drone insurance is companies that provide on demand insurance in one-hour increments. Coverage can be bought by the hour, by the month, or annually through SkyWatch. The flight must be mapped out and submitted to the carrier in order to receive a quote for coverage. Hourly insurance provides liability coverage only. If buying coverage by the month or year, liability and hull coverage can be purchased. Verifly sells coverage in one, four, or eight-hour increments. A list of various coverage providers can be found here: https://uavcoach.com/drone-insurance-guide/#guide-6.
As we have been writing about drones for quite some time, below is a list of all our articles covering all aspects of drones.
A Drone Discussion with James Van Meter
Who's Allowed to Shoot at Drones?
Risk and Insurance Considerations for Unmanned Aerial Systems
Drone is an Aircraft that Fits Under Aviation Exclusion
Limited Coverage for Designated Unmanned Aircraft
Homeowners Liability Exclusions for Unmanned Aircraft