The commercial use of Unmanned Aerial Systems (UAS), commonly known as drones, is rapidly increasing. According to a report issued by the Aerospace Industries Association, commercial spending on drones will almost double over the next decade and is expected to generate $89 billion in the next 10 years.
The FAA estimates there could be as many as 7,500 small commercial drones in use in the United States by 2018. Companies across the country are also looking at a wide range of ways for drones to help them improve their business.
As of June 23, 2016 the FAA granted 5,309 exemptions to commercial UAS operators. This is a 15.6 percent increase over the total exemptions issued as of April, 2016 and a 120 percent increase over the last 9 months. In January 22, 2016, the FAA reported that nearly 300,000 owners registered their small unmanned aircraft in the first 30 days after the December 21, 2015 registration requirement.
Drones have a wide variety of commercial uses including:
- Real estate surveys
- General aerial surveying
- Film and television
- Utility inspection
- Environmental uses
- Search and rescue
- Emergency management
Experimentation of UAS for wider applications continues. For example, drones are being tested as part of control systems for the operation of unmanned construction equipment.
While there are reports of misuse, the benefits of UAS to businesses are expected to outweigh the detriments:
- Job safety is likely to improve as these units are used more often for high hazard inspection and surveying purposes. Equipped with a camera, recording capabilities, and fail-safe technology, drones are being used for inspections of towers, stacks, bridges, tanks and vessels. With about the same level of quality for far less cost, drones can perform these inspections much faster than workers.
- Construction managers can deploy drones for the purpose of monitoring safe work practices at remote job sites and inspecting the quality of completed work.
Surveying and mapping large areas and performing specialty and high-risk tasks can be performed more safely and cost-effectively with UAS. Examples include:
- Monitoring storms and hurricanes during the event and surveying post-storm damage
- Excavation, tunneling, and trenching sites
- Investigations of catastrophic events such as:
- Earthquakes, floods and tsunamis
- Aircraft and train crashes
- Land surveying in extreme environments (temperature and terrain)
- Inspecting bridges and other infrastructure
- Close visual inspections of live flare stacks, flare tips and live transmission lines and towers
- Aiding in search and rescue, and helping emergency personnel find missing people in difficult-to-access locations
- Delivering supplies to disaster areas struck by catastrophes including earthquakes, hurricanes, floods and tornadoes (upon FAA approval)
- Enabling filmmakers and broadcasters to take advantage of aerial cinematography and special effects without risk to camera teams
- Allowing access to new visual perspectives and enabling access to areas that are currently inaccessible
Insurance carrier opportunities
Some insurers are utilizing drones for the following:
- Loss control inspections of roofs, bridges and difficult to access damaged property
- Claims management
- Workers’ compensation investigations and surveillance of suspected claimant fraud
- UAS are proving to be more cost effective and efficient than traditional stakeouts
- Cameras can be set to motion-activation and can automatically zoom in
- Scene investigations to accurately depict conditions when accidents occurred, including machine locations and conditions of premises (ex. Photos of a faulty roof or high piece of scaffolding). This also protects the adjuster from inspecting a piece of equipment which contributed to the workplace accident.
When drones are used for surveillance, guidelines need to be in place to assure compliance with applicable state privacy and trespass laws. To see a list of operational and operator regulations, download the full article here.
Article written by James Burkhart, Head of Loss Control at Everest Insurance®. James can be reached via email.
Everest Insurance® markets property, casualty, specialty and other lines of admitted and non-admitted direct insurance on behalf of Everest Re Group, Ltd., and its affiliated companies. Everest Re Group, Ltd. is a Bermuda holding company that operates through the following subsidiaries: Everest Reinsurance Company provides reinsurance to property and casualty insurers in both the U.S. and international markets. Everest Reinsurance (Bermuda), Ltd., including through its branch in the United Kingdom, provides reinsurance and insurance to worldwide property and casualty markets and reinsurance to life insurers. Everest Reinsurance Company (Ireland), Limited provides reinsurance to non-life insurers in Europe. Everest National Insurance Company and Everest Security Insurance Company provide property and casualty insurance to policyholders in the U.S. Everest Indemnity Insurance Company offers excess and surplus lines insurance in the U.S. Everest Insurance Company of Canada provides property and casualty insurance to policyholders in Canada. The Company also operates within the Lloyd's insurance market through Syndicate 2786. In addition, through Mt. Logan Re, Ltd., the Company manages segregated accounts, capitalized by the Company and third party investors, that provide reinsurance for property catastrophe risks. Additional information on Everest Re Group companies can be found at the Group’s web site at www.everestre.com.