Owning and operating an Unmanned Aircraft Vehicle (UAV) or drone is considered a high-risk activity. Flying crafts without insurance can lead to hefty payments when accidents occur or damage happens to the hull. It can also result in lawsuits or settlements if you fly without proper liability insurance for your passengers. In this article, you’ll learn all about aviation liability and hull insurance so you can make the best decision to protect your fleet, crew, and passengers. 

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Aviation liability and hull insurance offer coverage of damages to property from a wide range of causes. There are times when having insurance for your UAV or drone will save you or the business you work for a significant amount of money. Aviation liability and hull insurance are integral to ensuring you are covered in case of property damage to the hull, passengers, or property in the UAV and drone itself. 

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Hull insurance refers to coverage for the Unmanned Aircraft Vehicle or drone itself while aviation liability refers to coverage for third party bodily injury or property damage from the drone. Should any person or property with your UAV or drone be damaged during a flight, your aviation liability and hull insurance will cover the costs associated. Coverage options and premiums are based on quite a few factors including but not limited to:

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• Types of UAV or drone being flown
• Pilot experience
• Cost of the UAV or drone
• The primary use of UAV or drone 
• Number of passengers and/or property carried by UAV or drone 
• State and country minimums as required by law 

Any person or business that owns an Unmanned Aircraft Vehicle or multiple UAVs needs aviation hull and liability insurance. This will protect them in the event of an accident or damage to the UAVs in their fleet. Pilots will also need personal insurance as not all liability and hull insurances cover the pilot although they will cover the UAV and passengers.

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Depending on where you or your business or organization are based, there are likely state or country minimums for liability insurance much as there are basic liability packages for automobiles. Check with the local regulations and laws in your area to ensure you are sufficiently covered. 

There are quite a few reasons to obtain aviation hull and liability insurance. For starters, it may be illegal in your country or state to not have at least liability insurance for your UAV. In addition to local laws, repairs to UAVs that have suffered a peril or accident can be incredibly expensive. Should your UAV or drone crash or be hit by a damaging storm, fire, or natural disaster, you could lose the full cost of your UAV. Having sufficient insurance means you would be reimbursed for the full value. 

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Liability insurance is imperative as well. It covers the costs of bodily injury or death to passengers and third parties should an accident occur. Operating without this insurance could result in hefty lawsuits and settlements for passengers that fly on your UAV or drone.

There are a few options when it comes to protecting pilots and businesses with aviation liability and hull insurance. Similar to car insurance, there are liability coverage options as well as property or injury coverage as well. Combining both liability and hull is common among pilots. Under these plans, 70% of the overall premium covers the UAV or drone itself while the other 30% accounts for liability coverage. 

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Many people opt for coverage options that fully cover the value of their UAV or drone. This means that the insurance company will reimburse the full value of the UAV or drone should it be declared a total loss. Underinsuring your UAV will result in the company only paying for the agreed-upon coverage in the event of a total loss. Over-insuring may result in companies opting for hefty repairs rather than declaring a total loss.

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^{Hull Coverage}

Aviation hull insurance covers costs associated with repairs to the UAV or drone itself. It typically covers all damage from peril but does not cover wear and tear or maintenance. Coverage options vary based on the plan you choose. The main options offered by insurance carriers include:

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• Ground and Flight Coverage: Covers damage to the UAV whether it is on the ground or in flight. This covers any damage or peril including disappearance whether the UAV or drone is in flight or on the ground. 
• Not In Flight Coverage: Covers damage and peril to an UAV while it is on the ground whether it is in motion or stationary. 
• Not In Motion Coverage: Covers damage and peril to an UAV while it is on the ground and stationary. This is often included for stored UAVs. 

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^{Liability Coverage}

Liability coverage options cover injuries or expenses associated with passengers and properties on the UAV. Similar to hull insurance, there are various options available to businesses looking for liability insurance. The plan you choose will depend on the types of flights your pilots take. Here are a few common coverage options for aviation liability insurance:

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• Bodily injury or death sustained by passengers
• Bodily injury or death sustained by third parties other than passengers
• Damage to property owned by third parties

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Additional comprehensive coverage options exist to cover costs of damages to properties like runways, airplane hangers, and property should an accident with the UAV or drone occur.

It’s important to know what your insurance plans cover but equally important is knowing what it doesn’t cover. There’s nothing worse than going to file a claim only to find out that you are not covered under your current insurance. This is why it’s best to consult individual plans and options to make sure your business is protected based on how the UAV or drone will be used. 

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Since hull and liability insurance insure two different things. We’ll break down exclusions based on each type of insurance. You can bundle these two types of insurance together for full protection but the specifics of each policy will likely differ. Be sure to consult the exclusions on your specific premiums to make sure you are covered.

Depending on the type of insurance you purchased for your UAV or drone, coverage options may vary. If you purchased insurance that covers an Unmanned Aircraft Vehicle or drone regardless of whether it is on the ground, in flight, in motion, or stationary, you’ll be covered in a wide range of scenarios. However, there are still many instances where hull insurance typically won’t cover costs for repairs including:

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• Repairs resulting from general wear and tear repairs
• Use of UAV for purposes not set in the insurance policy
• Electrical breakdowns or malfunctions
• War-related damage or terrorist attacks
• Confiscation by government officials
• Hijacking
• Engine malfunction from excessive heat 

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When it comes to liability insurance, certain scenarios typically aren’t covered by insurance carriers. This will depend on the level of insurance you get. If your liability insurance covers bodily injury or death to passengers and third parties as well as third-party property, then you are covered in a wide range of scenarios. However, there are still some exclusions typical to liability policies including:

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• Intended or expected injuries
• Employee bodily injury
• Liability that falls under worker’s compensation law
• Damages or injuries caused by the application of chemicals or fertilizers
• Damages or injuries caused by electrical or electromagnetic interference, noise, or pollution

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The costs of aviation hull and liability insurance vary significantly based on a wide range of factors. There are many options available from carriers. Policy premiums are determined by a few things including:

• Value of the UAV
• Experience of the pilot
• The primary use of the UAV
• Where the UAV is stored
• How the UAV is stored
• Experience of crew members

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Those looking for more affordable premiums can provide evidence of the experience of their pilots and crew members. Insurance companies calculate policy premiums based on the overall risk assessment of an organization. This means they will calculate the overall safety of the UAV being insured as well as the experience of those operating. Working pilots and crew members with ample experience will lower the risk factor and this will help to achieve a lower premium for organizations and businesses. 

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Breakdown Of Aviation Insurance Costs

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