If you run a drone business, then I’m sure you’ve already had your “fun” finding an insurance provider. Finding insurance can be a time consuming and expensive process. With an emerging industry combined with uncertain and nebulous regulation, it’s easy to understand why.
“You’ve got this new emerging industry and there’s a lot of regulatory uncertainty and there’s a lot of companies with liability concerns,” says Lisa Ellman, a drone policy expert and co-chair of the Unmanned Aircraft Systems Group at the Washington D.C. offices of law firm Hogan Lovells. “Liability tends to be the first thing that comes to mind for someone developing a new business.”
A report released last month by UK insurance house Lloyd’s details just how challenging insuring the drone industry may become in the years ahead. The report cites “patchy regulatory regimes” and “poor enforcement” among the key risks facing the drone industry—risks that exist beyond the control of drone manufacturers or operators themselves.
Pricing risk in the absence of strong regulatory frameworks and enforcement mechanisms could prove troublesome, the report says. And, that’s before you delve into issues like third-party liability for a technology where risks range from broken windows or roof damage to major aviation catastrophes.