The lack of regulation is ‘undoubtedly’ the biggest barrier preventing the development of the sector and the creation of 100,000 jobs which experts predict could happen in the next decade, says the broker. The report, Dawning of the Drones: The Evolving Risk of Unmanned Aerial Systems’, says: ’For UAS [Unmanned Aerial Systems] operations to fully realize their commercial potential, national and international aviation laws may need to be overhauled and/or a set of international regulations developed that consider drone use in a truly consistent manner.’

Phenomenal potential

The broker is concerned at the effect of insufficient regulation on the drone sector. ‘Without solid regulation, confidence in these aircraft is likely to remain low,’ despite their commercial potential being ‘nothing short of phenomenal’, says the report. However, insurers are prepared to fill the breach for the meantime. John Hanslip, senior VP of Marsh’s Aviation and Aerospace Practice, said: ‘While clear and harmonized regulation is being developed, insurers are in the meantime filling this gap by providing their own safety guidance for clients, based on their experience of manned aircraft. In the US alone, several insurers are already writing policies on thousands of drones across the country.’ 

Tweaks to policies

Since regulators are generally not allowing larger drones to be flown without insurance, the broker says that insurers are working to provide that cover. John Hanslip continued: ‘Traditional policies for manned aircraft are being brought up to date and many only need tweaks to be usable for drone technology and deployment.’ Sources: Marsh;Insurance Journal; Actuarial Post