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Getting a drone this holiday season? Do you need insurance?

12/23/2015 3:03:58 PM

Drones are expected to be at the top of many holiday wish lists this year, and the Federal Aviation Administration (FAA) estimates that 1.6 million drones will be sold in 2015. 

“As drones become more affordable and available, the skies will be buzzing with activity,” says Minnesota Commerce Commissioner Mike Rothman. “Whether for personal or commercial use, drone owners need to consider a number of important liability and insurance issues, ranging from personal injury and property damage to trespassing and invasion of privacy.”

As the state’s insurance regulator, Rothman is offering some tips for Minnesota owners of drones, also known as Unmanned Aircraft Systems (UAS).

  • Any commercial use of a drone is restricted and requires special authorization from the FAA.
  • Any drone registered with the FAA for commercial use must also be registered with the Minnesota Department of Transportation (MnDOT), which requires proof of liability insurance. In addition, commercial drone operators must obtain a license from MnDOT before they advertise or operate their service. Details are available at www.dot.state.mn.us/aero/drones/.
  • Insurance companies have begun offering various types of coverage specifically for commercial drone use. Commercial drone users should carefully research their insurance needs and options before taking flight.
  • Recreational drone users are also subject to FAA jurisdiction, but do not require any special permission for most uses. The FAA recently announced a mandatory registration system for recreational drones and their owners, effective December 21. To register, go to www.faa.gov/uas/registration/.
  • Drone use for strictly recreational purposes is generally covered under a homeowners or renters insurance policy, subject to a deductible. Supplemental insurance is also available to recreational drone users through membership in the Academy of Model Aeronautics.
  • To confirm that your drone will be covered if it is lost, stolen or damaged, you should review the personal property coverage in your homeowners or rental insurance policy or talk with your agent. 
  • A larger concern is liability for an accident caused by your drone. If your drone crashes into someone’s house or vehicle, or injures someone, the accident is your responsibility. A homeowners or renters policy will generally cover this liability, but check with your agent or insurer to confirm.
  • Drone owners should also be mindful of trespassing and privacy concerns, not just for legal and insurance reasons, but also as a matter of common courtesy. Depending on the circumstances, your homeowners or renters insurance may not cover your liability.

The FAA and industry trade groups have produced a website (www.knowbeforeyoufly.org) to educate recreational drone users about safe, responsible flying. Key guidelines include:

  • Don't fly higher than 400 feet and stay clear of surrounding obstacles.
  • Keep the drone in sight at all times.
  • Stay away from manned aircraft operations.
  • Don't fly within five miles of an airport unless you have permission.

Commerce is here to help

If you have questions or concerns about your insurance, contact the Commerce Department’s Consumer Services Center by email at consumer.protection@state.mn.us or by phone at 651-539-1600 or 800-657-3602 (Greater Minnesota).

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