In recent years, the use of drones has soared to new heights across various industries, from photography and videography to agriculture and construction. For Custom Applicators, the added risk of spraying potentially hazardous chemicals makes it crucial for drone operators to understand the different types of drone insurance and make sure they are protected. Drone insurance not only protects your investment but also safeguards against potential liabilities that may arise during flight operations. In this article, we'll explore the different types of insurance coverage you may need for your drone operation.
1. Chemical Liability
For drone operators involved in agricultural or environmental monitoring, chemical liability insurance is essential. This coverage protects against any damages or injuries caused by the use of chemicals sprayed or distributed by the drone. Whether it's pesticides, herbicides, or other agricultural chemicals, chemical liability insurance ensures that you're financially protected in case of a crop claim, an accident, or some other environmental damage. For example, if you are spraying a herbicide on a field and the wind picks up, causing drift onto a neighboring property, the property owner can file a claim against you for the cost of lost crops, trees, grass, and potentially affects to animals and humans. This is serious and can be expensive. The basic coverage you want here is a minimum of $300k.
2. General or Non-Chemical Liability
General liability insurance is important for custom applicators. This coverage protects against third-party claims for bodily injury or property damage caused by your drone operations. Whether your drone accidentally collides with a powerline or hits a cell tower. If your drone hurts a person, who isn't your employee, or damages someone's property, general liability insurance provides coverage for legal fees, medical expenses, and compensation claims. The minimum coverage here is $100k.
3. Hull Coverage
Hull coverage, also known as drone or aircraft hull insurance, protects the physical drone itself against damage or loss. This coverage is particularly important for commercial drone operators considering you rely on your equipment to make a living. When your drone suffers damage due to a crash, which it will, or has a malfunction, is damaged by a natural disaster, or stolen, hull coverage ensures that the cost of repair or replacement is covered, minimizing financial losses. This is your most expensive insurance! And if you make a claim you can count on the insurance provider raising your rates. Expect a premium that is around 10% of the cost of your rig. You can insure other equipment as well like spare parts, batteries, mixing systems, etc...
4. Truck and Trailer Coverage
If you transport your drone equipment using trucks or trailers, it's essential to have adequate insurance coverage for these vehicles as well. Truck and trailer coverage protects against damages to the vehicles themselves, as well as any liabilities that may arise while they're in transit. This insurance is often provided by a different company than the Hull and Chemical liability coverage. Make sure you inform your insurance provider that you are using the vehicle and trailer for a business. The rates will be higher but you will be covered when they find out your wrecked your trailer while spraying fields... which may not be covered if you have a personal policy. Expect a premium of $1000 to $2000 a year depending on your rig.
5. Workers Compensation Insurance
For drone operators who employ staff or contractors, workers' compensation insurance is a legal requirement. There are specific providers of workers compensation insurance, so again, now you have another insurance provider.
This coverage provides financial protection for employees who suffer work-related injuries or illnesses during drone operations. Since your operators will be handling chemicals, and heavy equipment with spinning blades, and because it's the law, you need to have Workers Compensation insurance to ensure your team is adequately covered in case of accidents or injuries on the job.
What can I plan on for the total cost?
Expect to pay $3000 to 6000 per drone for a comprehensive insurance package. Rates will depend on your individual circumstances. Here's an example of a company with 4 agricultural drones.
Is it worth it? Yes! Insurance companies are very good about paying quickly for crashed drones. If you get a crop claim, those can be in the millions of dollars. Don't risk flying without insurance.
In conclusion, as a custom applicator drone insurance is a critical aspect of risk management for all drone operators. Whether you're flying drones for commercial purposes or recreational activities, having the right insurance coverage can protect you against potential liabilities and financial losses. By understanding the different types of insurance available and assessing your specific needs, you can ensure that your drone operation is adequately protected in all aspects. Remember, investing in drone insurance is not just about compliance; it's about safeguarding your assets and mitigating risks in an evolving and dynamic industry.
