Drone insurance offerings are everywhere. For many operators, both recreational and commercial, the options are confusing – and expensive. How much drone insurance do you really need? How much should that cost? We talked to an industry leader to find out.
Insurance provider Verifly is the world leader in “episodic insurance,” which means insurance that covers the exact time that you’re actually flying. They built a brand new platform which became an industry standard so quickly that the company was featured on Jeopardy! Clue within 18 months of launching.
What is Episodic Insurance?
Episodic insurance differs from a traditional policy. Operators receive liability insurance just for the time and area that they fly for a particular job, and the rate varies depending upon the risk involved in the flight. There’s no barrier to entry – you download an app on your phone and get insurance for the job that you’re flying. There’s also no annual fee and no long term commitment, features which provide a lot of appeal for new businesses or recreational flyers. Verifly CEO Jay Bregman says the company has been moving fast since inception. “We built our platform from the ground up including a new insurance product which is approved in 48 states,” says Bregman. “We now arrange insurance for pretty much any flight drones are allowed, including night, indoors, and up to $10M limits. Over 20% of Part 107 licensed commercial pilots are registered with Verifly.”
Who Should Use Episodic Drone Insurance?
Episodic insurance is an option for all kinds of drone operators. Commercial operators like it because it provides a clear way to track expenses, benefiting both the operator and the customer. Customers don’t pay for the insurance on someone else’s job, and operators aren’t paying for insurance while the drone is on the ground. “Our precision insurance allows pilots to purchase in bite-sized pieces tailored to a particular job, which most of them expense right back to the client in full.”
It isn’t just full-time operators who need liability insurance – and for part-timers, episodic insurance can be the perfect solution. “Drone pilots are the quintessential gig economy profession,” says Bregman. “Virtually everyone is doing it part time, whether because they’re photographers offering it as an add-on to their existing business, or they’re IT professionals on a side-hustle. For them an on-demand episodic solution they expense right back to clients is a no-brainer.”
Do I Need Drone Insurance if I Only Fly for Recreation?
If good fences make good neighbors, good insurance does too. Every drone operator knows that flights don’t always go as planned, and when your drone breaks a window or lands on your neighbor’s new Mercedes, you may need to make amends.
As many operators know to their cost, relying on your homeowners policy to cover you is a very risky strategy. “If you have to make a claim on your homeowners policy (assuming they even cover it) your premiums will increase and it could potentially affect your ability to get future homeowners insurance, which is a big deal,” points out Bregman.
My Flying Club Offers Insurance – What About That?
Flying club insurance can be a reasonable option, but as with any policy, the devil is in the details. These offerings usually exclude any and all commercial use of the drone. Many flyers don’t understand what that means: but the FAA definition is extremely clear. Flying for a neighbor who is trying to sell their house, flying over your church for publicity photos, or taking footage of a school event for the website are all commercial uses – even if you aren’t getting paid.
How Much Should Drone Insurance Cost?
Cost is one of the most compelling features for episodic insurance. Prices for Verifly, for example, start at $10/hour and go up based on factors like where you fly and the coverage that you require. (Operators always know the price upfront before you purchase.) For recreational operators who want to make sure they have liability coverage it’s an economical safety net; commercial operators have clear documentation of their costs for a specific job.
Drone insurance has become a must for every flyer. Episodic drone insurance is fast, easy and inexpensive – and can save operators from the slow, difficult and costly process of trying to process a liability claim through other policies.