Commercial Drone Operations in the Insurance Industry

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Since their introduction into the market personal drones have become a hot topic. From everyday users uploading exciting aerial video, to industries planning on implementing drones in the near future, the way people are viewing these miniature aircraft is rapidly changing.

As the bigger players within the Insurance industry already have drone operations in place, we felt it would be important to read up and find out about drones and how they will impact the near future.



What Are They?

For more than half a decade we have been hearing about unmanned aerial vehicles (UAVs), or drones being used by our military in various conflicts overseas. While combat drones are still in use, a market for personal drones has slowly been emerging over the past few years, however, these are not the same massive machines our military uses, but they are smaller, more affordable versions.

It should be said that remote controlled model airplanes have existed for decades, and while modern drones and RC airplanes have obvious similarities, it is typically the configuration of the aircraft that deems it a drone. The most recognized personal drone configuration is the quad-copter configuration; featuring 4 rotating blades that allow the vehicle to hover and take vertical take offs and landings. The truth is that they can come in all shapes, sizes, and configurations; they can drive, they can fly, or even be built to do both.



Rules and Regulations

When personal drones initially hit the market, there were very few regulations in place, but since 2016 the FAA has stepped up and applied regulations for personal and commercial operations of drones.

In the early days of personal and commercial drone use, there were no official regulations in place, however, a court case that involved a drone operator initiated the process for the FAA to be the de-facto governing body for drones. Shortly after the court ruling the FAA had granted several official licenses to industries to explore the use of drones for business, however, unofficially, some businesses took the risk of being possibly fined by the FAA since there were no exact rules saying the FAA needed to grant licenses or enforce existing rules. That changed in November 2014 when the National Transportation Board made a ruling that the FAA can enforce rules on drones.

Even though regulations were expected in late 2015, nothing was announced and speculation of stringent rules was hinted at by the Wall Street Journal and other news sources.

Finally in June 2016, the FAA and DOT announced regulations for personal and commercial drone usage. The final details of the laws paved pathways for both personal operators and commercial pilots, applying strict but fair rules for each. The basic information for personal and commercial operators are listed below:

Personal Operation
(Section 336)
Commercial Operation
(Part 107)
  • Fly for hobby or recreation ONLY
  • Register your model aircraft
  • Follow community-based safety guidelines and fly within the programming of a nationwide community-based organization
  • Fly a model aircraft under 55 lbs. unless certified by a community-based organization
  • Fly within visual line-of-sight
  • Never fly near other aircraft
  • Notify the airport and air traffic control tower prior to flying within 5 miles of an airport
  • Never fly near emergency response efforts
    • Fly for recreational OR commercial use
    • Register your drone
    • Get a Remote Pilot Certificate from the FAA
    • Fly a drone under 55 lbs.
    • Fly within visual-line-of-sight*
    • Don’t fly near other aircraft or over people*
    • Don’t fly in controlled airspace near airports without FAA permission*
    • Fly only during daylight or civil twilight, at or below 400 feet*

* These rules are subject to waiver.

For more information, see:
Fly under the Special Rule for Model Aircraft
For more information, see:
Fly under the Small UAS Rule

Many of the commercial regulations are subject to an FAA waiver, meaning the FAA is open to bending the rules in specific cases. Recently the DOT has announced plans for looking into increased drone flights in select areas. Many of these areas are remote and would allow for inspections or controlling insect populations.

If Amazon is the largest company looking into commercial drone operations, the Property & Casualty Insurance industry, as a whole, may be a very close second. From basic home inspections, to monitoring crops, and damage assessments in natural disasters, the P&C industry has been waiting for the opportunity to commercially operate drones. In terms of rules regulating operations, they may vary from state to state, however, some basic guidelines to follow would include:

  • Get Permission: Inform anyone in the vicinity know that you’ll be piloting a drone with a camera and that image might be captured on video.
  • Privacy: Never deliberately take video or pictures of anyone without their permission. Don’t harass anyone or any animals with the drone.
  • Stick to the flight plan: Don’t fly over someone else’s private property.
  • Personal Data: Only gather personal data if it’s necessary for the job, and discard it as soon as you can. If some data must be kept, keep it secure.
  • Be Polite: Be reasonable in discussing privacy and safety concerns with others. Delete data, photos, or video if the subject of the images and data asks you to.

While there may be existing regulations for commercial operations for drones, there are still questions that need to be answered and in time they will, however, the best we can all do is to use our best judgment when operating drones.

For more on what we do know about drone regulations, click to view the following links:


To Buy or Build?

For those wanting to jump into the world of piloting a drone they can take two paths: buy a pre-made drone, or build their own from scratch.

Just like any other item sold in the market, drones are sold ready to fly. Some may require a few pieces to be put into place, however, most of the hard work is already taken care of, such as matching components or programing the drone itself.

Components can be purchased separately so builders can create something custom built to their own needs. Some parts for building a drone are solder-less, and feature connectors to swap out parts to upgrade quickly; others may require some soldering. There are nearly limitless options to building a drone.

A few things to consider when building your own drone may be:

  • Drone Use: Will you be taking video of property, collecting aerial data, or flying for fun?
  • Maximum Weight: The weight will affect the size of motors, fans, and batteries you will need.
  • Attachments: If you plan on mounting a camera to your drone, then be sure to add that into your total weight.
  • Power: Having the right battery is important for your drone and can be the difference between flying or being grounded. Also verify that your power requirements, such as Ohms and Amps, are properly calculated, matched, and met.
  • Programing: Now that you have your hardware, you may need to program the software so your drone can actually fly. There are many tutorials to help you program your drone and get it in the air.
  • Practice: Flying a remote controlled drone is not as easy as it sounds and will take some practice. Expect there to be some crash landings.



An Accessory For Industry

Cameras have now become a major decision when enthusiasts are considering purchasing or building a drone. A simple search of YouTube contains hundreds of videos showing pilots flying over cities, landscapes, or even into a firework’s display. The footage that modern cameras are able to capture combined with the smooth air ride of a drone is becoming an important tool for photographers, directors, and even insurance inspectors and farmers. Considering that, its no surprise that Hollywood is even embracing drone technology. From integrated 4KHD cameras to Go Pro rigs, there is something for everyone when it comes to capturing amazing video and pictures.

The shipping industry is also ready to capitalize on drones, as aerial deliveries or even same day deliveries may be something to look forward to in the near future. Amazon, the online retail giant, is waiting for regulations to catch up to their delivery plans.

As noted in the regulation section of this article, the inspection of farmland and crops are becoming a standard in the farming industry. Using drones to inspect their fields saves time, money, and precious resources. By using this new technology, they are now able to do an activity in a fraction of the amount of time that may have otherwise taken an entire day or longer. Drones are becoming more popular with farmers and residents in rural areas that need to maintain large areas of land.

The Insurance Industry has also been keeping an eye on drone technology. Home inspections are well under way and the operator market is only getting more competitive. Other industries are also launching their own inspection operations; from massive oils rigs, to bridges we commute on every day, people are using drones to inspect infrastructure at a fraction of the cost.

Even storm chasers are planning on using drones in the near future. Being an already dangerous occupation, storm chasers are hoping to gain valuable data as they send off the tiny UAVs into dangerous thunderstorms and tornadoes. The potential information they could gain from such deployments could allow for better forecasting and improved warnings.

During last year’s rash of hurricane’s and tropical storms, we saw drones assisting with recovery efforts and damage assessment. Many of news outlets broadcast the destruction to viewers bringing a new perspective to the devastation left by Hurricane Maria.

The future for commercial drone operations appears to be very bright and the opportunities of including drones in various industries is constantly growing. We have gone from the Wild West in terms of regulation, to the existing regulations; if the future pans out like those in the tech, insurance, and transportation industry sees it, seeing drones fly around us will be part of our everyday life.