THEY will soon be ubiquitous in our skies, but businesses considering the use of drones should be aware of the pitfalls, according to a Scottish insurance law expert.
Drone technology for commercial purposes is on the increase, with the Civil Aviation Authority having seen an increase of 80 per cent in drone use approvals since the start of 2014, but businesses considering the many and varied uses for drones must be properly prepared for take-off.
Douglas Keir at Weightmans (Scotland) LLP, an expert in insurance law, said: “The popularity of drone use is increasing, and there are some really positive business benefits to be had from their use.
“However, with increased popularity comes an inevitable uplift in the accident rate, and it’s only a matter of time before something serious occurs. Not only must businesses ensure that they are using the technology properly, safely, and within the confines of the law required to get off the ground, they really need to be prepared for when something goes wrong.”
So far there have been no major injuries caused by crashing drones, but in December 2014, a customer was injured in TGI Fridays in Brooklyn, New York, by a mistletoe-carrying drone.
Weir said: “It won’t be long before this type of incident turns from a light- hearted ‘and finally’ moment to a serious incident, and all of a sudden small businesses could find themselves thrust into the liability spotlight.” Unlike in the USA, commercial use of drones is allowed in the UK subject to prior permission being granted by the Civil Aviation Authority.
Potential commercial uses for drones include surveying and managing farmland, animals, crops or large estates; delivering goods to customers; news organisations may use them for photography purposes; general promotional activities and risk assessment and security surveillance.
Businesses should know that they, as drone operators, are required to operate in accordance with many different types of legislation, such as the Data Protection Act.
According to Keir, insurance brokers are still working out how best to cover their customers. With a far wider customer base now involved in ‘piloting’ aircraft, albeit remotely, then this gives rise to different concerns for their customers whose operations may have previously been rooted firmly in the ground.
Keir said: “With such a range of usages for drones, a detailed consideration of potential risks is recommended.
“Third party risks are likely to be wide-ranging to include collision with other aircraft, fixed structures and even people. First party risks are likely to arise in respect of drones with widely differing values.”
Keir warned that coverage considerations for even small scale operations should therefore include first and third party property damage, death and bodily injury, cyber, business interruption, civil and criminal defence costs, and damage to a firm’s reputation.
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