Boom in drones triggers insurance liability coverage requirements

The number of businesses using drones is growing so fast it's forcing some insurance companies to offer specific coverage. 

It's becoming an emerging issue within the insurance industry right across the country, according to Amanda Dean, the Atlantic vice president of the Insurance Bureau of Canada. 

"The need is out there and folks are using these drones for business purposes," she said.

"Liability arising from drones and drone usage for commercial purposes would generally not be covered in a typical commercial policy…business insurance coverage, as they would fall within the aviation exclusion of a general liability policy." 

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One company that does offer coverage to small and medium-sized businesses is Intact Insurance. It can add "unmanned air vehicle coverage" to both property and liability insurance.

"The number of businesses using drones is increasing due to improving technology, lower price points and expanded uses within commercial operations," the company said in an email to CBC News. 

The drone policy would protect a company against damage done by, or to its drone. 

Dean said a company that offers drone insurance through a commercial policy makes it more accessible for businesses. 

'Is it worthwhile'

But that kind of insurance policy might not be all that helpful, according to Mark Langille, a partner with flitelab, a Halifax company that uses drones in everything from TV productions to aerial photography for condo developers. 

"It's relatively expensive to add basically the equipment side of the insurance and, depending on the system that you're flying, it's really kind of a trade off," Langille said.

"Is it worthwhile to have damage insurance or not? That side is not mandatory, it's just the liability that you must carry."

Transport Canada currently requires companies using drones have to have $100,000 worth of liability insurance in case of an accident, said Langille. 

Good commercial drones can range in price from $1,000 up to more than $100,000, depending on what they're designed to do, said Langille. 

Ultimately Langille said the explosion in commercial interest in drones may simply be due to the technology's cool factor. That could wear off once businesses start examining how much paperwork and cost goes into running a drone. 

"I think it's really going to come down to the upfront investment but also are you going to make enough use of it to stay proficient and get your money back out of it," said Langille.