A coordinated, international approach to the regulation of aviation drones is essential for the technology to thrive, said the International Underwriting Association (IUA), which represents wholesale re/insurance companies in the London market.
As a result of rapidly growing interest in the use of small unmanned aircraft systems (UAS), the IUA said its market underwriting committees, which deal with both aviation and general liability risks, are examining the challenges in providing insurance cover.
The IUA said it also has corresponded with various supervisory bodies that are developing new rules governing UAS operations. For example, the IUA has responded to consultations on the regulation of aviation drones from both the European Union and the Federal Aviation Administration of the U.S.
Chris Jones, IUA director of Market Services, commented: “A clear and harmonized system of regulation would greatly benefit the development of drone technology. It would help insurers obtain a clear understanding about the potential size of the market and allow them to benchmark operators against recognized standards.
“In particular, it is important that there should be as much centralized data as possible about the number of drones in use and any accidents that have occurred. This would complement risk information procured as part of the insurance placing process and allow insurers to more accurately price essential cover.”
IUA member companies are writing drone risks and working to offer new insurance products as the use of the technology develops, the IUA said in a statement. “Expertise is required to analyze both potential physical losses represented by the aircraft itself and liability risks. The latter covers third party bodily injury and property damage, product liability and privacy issues.”
Jones added: “Growth projects for the use of unmanned aircraft systems are quite dramatic, but there are still a number of safety, security and privacy concerns. The insurance industry has an important role to play in addressing these issues and helping the technology fulfill its promise by delivering benefits across a range of commercial applications.”
Source: International Underwriting Association
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