Two more insurers have received approval to test the use of unmanned aerial vehicles (UAVs), or drones, for their business.
The Federal Aviation Administration (FAA) has approved requests from USAA and American International Group (AIG).
State Farm said last month that it became the first insurer in the U.S. to receive FAA permission to test drones for commercial use. State Farm plans to explore their use in assessing potential roof damage during the claims process and in responding to natural disasters.
USAA also wants to test how drones might help speed review of insurance claims following natural disasters. USAA can now fly drones, made by U.S.-based PrecisionHawk, during the day within line-of-sight of a trained pilot and air crew. Prior to the approval, USAA test flights could only take place at FAA-approved sites. No aircraft will exceed an altitude of 400 feet, and all flights will continue to be reported to the FAA prior to takeoff.
With FAA approval, USAA said it will work with PrecisionHawk to research best practices and safety procedures as it further develops plans for operational use.
USAA said it has also filed for an additional FAA exemption to further expand its ability to use drones in catastrophes. A decision on that request from FAA is expected soon, according to the insurer.
AIG said it will now be able to experiment with small UAVs to conduct inspections for risk assessment, risk management, loss control, and surety performance for customers in the U.S. The FAA exemption also permits AIG to implement a research and development program to explore new ways to employ UAVs.
State Farm said it will first conduct flights at private test sites in the Bloomington, Ill., area where it is headquartered but eventually the drones will be tested in real-world scenarios.
Erie Insurance has also requested permission for drone testing.
AIG said it already has an international UAV research and development program and has conducted flights in New Zealand.
Commercial drone flights are generally banned in the U.S. However, the FAA has awarded 99 waivers for commercial drone use under a program created by Congress to allow flights while the agency completes more formal regulations.
While the use of drones is restricted, that has not stopped businesses including real estate agents and film studios across the country from using them. It also has not stopped some insurance carriers and brokers from insuring them. A recent report by Bloomberg found some insurers imposing their own safety rules rather than waiting on the FAA.
But the insurance industry as a whole would prefer to see the government set the rules.
“Companies across the country have already begun using drones for many different purposes, and insurance companies are eager to provide coverage for their loss or liability. But we need the government to set the ‘rules of the road’ for legal drone use so that insurers can begin to evaluate different risks and underwrite coverage,” Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies (NAMIC), said in testimony before a recent Senate panel on drone regulations.
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