You can buy car, house, boat, and life insurance; now industry giant AIG is offering insurance for your drone. AIG’s Chief Technology Officer Mike Brady told Oracle’s OpenWorld conference this week that drones will be a significant factor in the insurance industry in two ways. First, he said that drones will be a major tool in damage assessment and disaster recovery. For this reason, Brady says that AIG received a commercial license from the FAA last April, and AIG’s IT department is currently working on developing the industry appropriate technology.
Second, citing the AUSVI’s estimate that there will be 160,000 drones sold every year by 2025, AIG has established policies covering drone damage and liability. Brady says that the sheer volume of drones in the air “creates risk,” and the company has developed products to protect drone owners’ investment.
AIG’s policies may cover “physical damage to the aircraft itself, along with installed, or carried equipment, and ground control units …; Third party liability; [and] War, Hi-Jacking and Terrorism.” Policy language also states that “There is NO exclusion for loss arising from electronic malfunctions and failure of electronic components, accessories and power equipment (Such and exclusion is standard on manned aircraft policies.)”
AIG also offers liability only coverage designed for “unmanned aircraft up to five pounds, with wingspans or combined rotospan of up to three feet.” The offering states that “this Unmanned Aircraft Liability Endorsement will soon be available for everything from farming to infrastructure maintenance, to construction, to oil and gas exploration,” and offers “optional coverage for hi-jacking or any unlawful seizure or wrongful exercise of control by means of ‘spoofing’.”
AIG joins several specialty companies offering drone insurance, and others who include coverage under existing homeowner’s policies; however, they are among the first of the large insurance companies to offer liability insurance specifically for drone operators.