Insurers step up for drone pilots unwilling to wait on FAA rules
(Bloomberg) — Thousands of drones flown without government approval by real estate companies, movie studios and other businesses are getting coverage by insurers writing their own safety rules to fill a void left by regulators.
One insurance broker in Colorado has already written policies on 2,600 drones, and a San Francisco-based company said it has assembled an Uber-like list of 1,000 trained operators businesses can hire to do the flying for them.
Commercial drones are photographing sporting events, monitoring construction sites and performing other aerial chores even though the Federal Aviation Administration is as many as two years away from issuing final regulations to govern their use. The FAA, which won a legal ruling in November that said it could apply existing aviation laws to drones in the meantime, says none are supposed to fly without a formal waiver — only 39 have been issued — until then.
In a Feb. 15 proposal to allow unmanned aircraft weighing less than 55 pounds (25 kilograms) to fly for hire, the FAA projected there would be 7,550 of them within five years of enactment. In reality, there are already more than that in the air now, according to insurers, aviation lobbyists and academics.
“We’ve been insuring them for going on four years,” said Terry Miller, owner and president of Transport Risk Management Inc., which had to invent safety requirements for its drone clients.
Purchasing insurance for commercial drones, which isn’t prohibited under FAA rules, doesn’t make flying them legitimate, the agency said.
Whether drone operators’ actions are legal doesn’t affect Miller’s willingness to write insurance. He said that, while he welcomes more FAA oversight, there’s no point in waiting for the rules to be completed and that the standards his company sets for insurance policies often exceed what the government has proposed.
Catching Up
Such a disconnect between the FAA and an industry plunging ahead without regulators’ approval raises questions about aviation safety and is testing the agency’s ability to carry out its enforcement and oversight obligations.
“There are thousands of companies already doing experimentation,” said Christian Sanz, the founder and chief executive officer of Skycatch Inc., a San Francisco-based drone mapping company for mining and construction sites. Skycatch has even taken to crafting an automated system similar to Uber Technologies Inc.’s car ride-hailing service.
Education Campaign
For now, an education campaign by the FAA and its attempts to contact businesses to persuade them to halt unauthorized flights haven’t always successful. Turning its proposal into a formal regulation under the mandatory process of sifting through public reaction can take years; the Government Accountability Office has penciled in 2017 as the earliest date for completion.
“The FAA will investigate any reports of unsafe and unauthorized UAS operations, including incidents identified by the media,” the agency said in an e-mailed statement, referring to the more formal name for drones: unmanned aircraft systems.
The FAA said that existing aviation regulations, which apply to unmanned aircraft, give it the authority to ban commercial drone flights that haven’t received waivers to operate. The agency has issued fines against an unspecified number of drone operators, it said in the statement.
In other cases, the FAA has worked with law enforcement agencies to contact people who have operated drones that were unsafe or unauthorized, the agency said.
No Rules
Harry Arnold, owner of Detroit Drone, said he’s hoping the FAA rules go into place as soon as possible. That hasn’t stopped him from running a drone photography business for the last five years, he said, and won’t stop him from continuing.
“It is not illegal,” Arnold said in an interview. “There are no rules yet.”
His website includes aerial video of real estate developments, construction sites and a car race.
Arnold, who said he doesn’t have an FAA waiver, disputes the agency’s authority over commercial drone flights with regulations still incomplete. “The FAA cannot regulate through press releases,” he said. “That’s not the way it works.”
While some drone entrepreneurs may see their wings clipped once the FAA’s new restrictions become finalized, tighter standards are good news for the sometimes chaotic, unregulated industry, Miller said.
“I’m overjoyed to see it,” he said.
