Resources & Insights

Drones in Construction: Are You Covered?

September 7, 2016

Invasion of privacy. Cyber laws. Even acts of war.

drones construction insurance
CCIG’s John Mayerle

Use of unmanned aerial drones in the construction industry raises all kinds of risks, few of which are addressed in general liability policies, which typically include aviation exclusions.

Despite that, the use of camera-mounted drones in coming years is expected to become commonplace at construction sites, helping to reduce the industry’s reliance on cranes, helicopters and other heavy equipment, saving companies money and delivering greater accuracy.

Construction companies already have embraced drones to get a bird’s-eye view of the progress of their jobs as well as to survey, map and create 3D modeling of sites. Drones also are helping companies keep their employees out of harm’s way.

Use of drones is expected to rise even more dramatically under Federal Aviation Administration rules that went into effect this year.

Sometimes, companies hire drone contractors to do the work for them. Sometimes they do it themselves. In either case, there are a number of points to consider to ensure you’re protecting your workers, your company and its future.

For starters, FAA approval is required for any commercial use of a drone. In some cases, companies still must submit a Section 333 application with the FAA in order to fly drones at night or over crowds. This can be a time-consuming process, taking several months, but going without it could nullify any insurance policy.

Your pilot-operator – whether someone on staff or someone you’ve hired – must be properly licensed. The drone itself also must be registered with the FAA.

Assuming the FAA gives its OK and your pilot checks out, what are the personal injury or property damage risks?

Also read: Construction Leads U.S. in Struck-by Accidents, Deaths

These can be significant, especially with the heavier drones used in the construction industry. Even smaller drones travel with enough force to cause plenty of damage.

You’ll want to check whether your insurance policy includes an exclusion for bodily injury or property damage caused by the use of an “aircraft.” If it does, you need better coverage. Be sure to look whether a drone is, in fact, viewed as an “aircraft” under the policy.

Also, the use of high-resolution cameras or video, as well as data-gathering capabilities, could lead to privacy and data-hacking concerns and liability. That’s because drones often capture data that someone might not want anyone having. That includes images of people in their homes.

As rare as it is likely to be, drones can be hacked in flight by someone who overrides the controls and then crashes the drone into, say, a group of people or a public utility. That qualifies as an act of war – and serves as yet another good reason to get drone coverage.

If you’re hiring a drone operator as a contractor, be sure there’s an indemnification clause in the contract and that your firm is named as an additional insured. The drone operator’s insurance policy should hold you harmless for any mishaps.

The bottom line: A property and casualty insurer who knows the construction trade but little about aviation and aerospace risks and exposures isn’t the place to go to buy drone coverage.

John Mayerle is CCIG’s Director of Risk Control. He can be reached at or 720-330-7919.

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