Christina Cardoza

Aug 11, 2016 12:38:40 PM

You wouldn’t drive a car without any insurance, so why fly a drone without that same protection? Of course, you are not actually seated in the drone itself, but that doesn’t mean you are not liable for anything that might go wrong. Verifly, a newly launched on-demand drone insurance company, wants to offer that protection for drone operators.

“What happens when there are many of these devices, and they start crashing into one another,” said Jay Bregman, CEO and co-founder of Verifly. “How can the market grow if somebody doesn’t solve this problem?”

Verifly is designed to address the problem by providing an insurance model that lets operators get coverage as they need it. The insurance is provided through an iOS or Android app that gives operators information about nearby hazards, weather conditions, and FAA objects such as airports and teleports. Within the app, the system will draw a quarter-mile radius around the drone as the operator’s coverage area. The pricing starts at $10 an hour, and is adjusted depending on risks inside that coverage area and environmental factors. Within that coverage time, operators can also fly multiple drones under the same policy.

According to Bregman, the insurance gives operators a million-dollar policy that covers third-party liabilities and $10,000 worth of invasion of privacy. The invasion of privacy policy pays for any damages insurers might come across if it violates a person’s right to privacy. “For example, if you fly your drone inside the policy coverage area and capture video of a third party, then post it on YouTube and are sued for damage caused by its publication, the policy arranged by Verifly will respond to this claim, subject to certain exclusions, including knowingly violating the rights of a third party and criminal acts, among others,” according to the company.

“We decided that the best way to solve this problem was by building a new kind of insurance product that was specifically designed towards drones, the technology as well as the way in which people use them. So that is where we came up with Verifly, which delivers on-demand drone insurance for recreational and commercial users,” Bregman said.

Bregman explains the company decided to go with an on-demand model because not all operators, businesses or companies need to fly multiple times a day, making annual insurance policies too expensive for them. For businesses that already have an annual insurance policy in place, Bregman says they may still have drones in their fleet that are not covered by their policy because they don’t use them that often, and this is an opportunity for those businesses to use those additional drones.

“As the market grows, people will become uncomfortable, and [they] are already uncomfortable with the fact that they don’t want to be flying their drones and putting their whole asset base at risk,” said Bregman. 

Verifly currently does not cover the drone itself, but it is exploring covering that in the future.”The cost of crashing a drone maybe costs a $1,000 to $,3000, but the cost of potentially getting into an accident where you fall on your neighbor’s BMW or worse can be a much larger problem,” he said.

The insurance model is available in 40 states, but Verifly plans to have the entire U.S. covered by the end of the year.

With Part 107, the FAA’s new commercial drone rule, going into full effect by the end of the month, Bregman says this type of insurance policy is more important than ever.

“You don’t take Part 107 and go through all the trouble to do that if you don’t want to actually work. And if you want to work in the United States you are going to be confronted with the fact that the best jobs require insurance,” he said.

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