Non-Owned Insurance Coverage For
Non-Owned UAS and UAV Hull and Liability Insurance
Corporate Non-Owned UAS and UAV Liability Insurance provides coverage to companies or individuals that use UAS and UAV that they do not own and that are operated by third parties such as hired commercial operators. These exposures are primarily contingent liabilities where the user does not employ the crew and is not directly involved with the operation and maintenance of the UAS, UAV, Drone or RPAS.
Non-Owned Hull and Liability for UAS and UAV
Who needs Non-Owned UAS and UAV Liability Protection?
You do, if you or your organization uses an UAS or UAV that you or your organizations do not own, even if you are only a passive customer.
What are some examples of non-owned UAS and UAV exposures?
How likely is it that there will be protection under the owner's insurance policy for a "non-owner" user or customer?
It depends on your connection to the UAS owner, whether there are adequate limits, what the owner's policy says about protecting you, the use of the UAS, etc. Are you a an organization responsible for hiring the UAS or UAV flight? If you are responsible for arranging or operating the flight, you most likely do NOT have protection.
Why wouldn't the UAS or UAV owner's insurance policy protect me?
As stated above it may. Most policies extend protection under the liability coverage (bodily injury andproperty damage) to permissive users or to entities responsible for the operation but only for liability of the Named Insured (operator) and not for their own liability or neglegence. Additionally, such extensions generally do not apply to damages to the aircraft itself but only to bodily injury and other property damage.
How can I know if I am protected under the UAS or UAV owner's insurance policy?
You can't know for sure unless you read and understand the owner's policy. Some policyholders may not be sure about who is and who is not protected in their own policy. Some have confused being a permissive user, customer or an approved pilot with being included for liability insurance protection. Such may not be the case, especially for persons working in commercial aviation or the business of arranging UAS or UAV flights on behalf of others.
Can I buy my own insurance to apply when I use a UAS or UAV that I do not own?
Yes, if you qualify. Coverage is generally available for all uses:
For Corporations - Corporate Non-Owned UAS and UAV Liability Insurance.
For individual licensed renter pilots - Personal Non-Owned UAS and UAV Liability Insurance.
Corporate Non-Owned UAS and UAV Liability Insurance policies can be broader in the types aircraft covered provided they are only operated by pilots furnished by the aircraft owner such as hired UAS and UAV aircraft. With hired UAS and UAV aircraft, the exposures are mainly contingent liabilities since the customer is not directly involved with the operation and maintenance of the UAS. If the operator or pilot is an employee of the corporation being insured, coverage may still be available, but would be rated in accordance with the pilot's experience and may be limited to certain UAS types or models.
Personal Non-Owned UAS and UAV Liability Insurance is usually limited to specified types of UAS with which the individual has substantial experience flying.
What if I own a UAS or UAVE, have insurance for it, but occasionally use someone else's aircraft?
Most UAS insurance policies have provisions that could apply to the named insured's use of a non-owned aircraft. The coverage is usually set forth in a section called "Use of Other Aircraft." Under it, liability coverage is extended to apply when the named insured is operating another aircraft. It should be noted that this provision usually applies ONLY if the named insured is one individual (may include spouse) and not if the named insured is a corporation or more than just one individual (such as co-owner named insureds). Approved non-owned aircraft may be limited to aircraft of the same type as the insured aircraft. This protection would apply as excess over any other valid and collectible insurance available to the named insured (e.g., coverage may be available under the owners insurance).
It should also be noted that the "Use of Other Aircraft" provision may not extend to cover damage to theaircraft being operated. Further, coverage would not apply to any aircraft that the named insured owns, in whole or in part, or that is rented or leased for more than a short period, seven to 30 days.
Corporate named insureds can usually have the insurance on their owned aircraft endorsed to include the corporate use of non-owned aircraft, although this feature is not always part of a corporate UAS or UAV policy. An endorsement can be added to include property damage liability resulting from damage to the non-owned aircraft.
Most UAS and UAV insurance policies have a provision for extending liability coverage to apply to a temporary substitute aircraft. This coverage applies when the insured aircraft is down and out of service because of breakdown, repair, servicing, loss or destruction and another aircraft is used as a substitute.
What is "Non-Owned Hull" insurance?
It is a confusing term that could be misleading. It has been occasionally misunderstood as being physical damage ("Hull") coverage on a non-owned aircraft. It is not. Actually it is provided as an exception to a typical property damage liability exclusion. The exclusion eliminates protection under Property Damage Liability insurance for damage to property belonging to others but which is damaged while in the care, custody, or control of the insured. The so called "non-owned hull" insurance sets aside this exclusion and makes coverage available for property damage liability arising out of damages to a non-owned UAS or UAV. This coverage is more properly referred to as "Liability Coverage for Damage to Non-Owned Aircraft." Since the phrase "non-owned hull" is not as wordy, it is often used when discussing this coverage, even by insurance professionals.
Do Non-Owned claims really happen?
Yes. And when they do occur, they tend to be very complex especially when interchange becomes part of the equation.