Does Homeowners Insurance Cover Recreational Drones?

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Your drone is likely to be covered by your homeowners or renters insurance if it is used for recreational use--and not for any illegal purposes. Drones are relatively new in the eyes of regulators and insurance companies, so it can be difficult to determine when your drone is and isn’t covered in some cases. In this article will shed some light on when your drone is insured.

When Does Insurance Cover Drones?

Your drone is considered a model or hobby aircraft so most homeowners or renters insurance policies will cover it as personal property by your insurance. For it to get that consideration though, you must recreationally use it as a hobby for at least 90% of the time. Using your drone commercially, such as filming weddings for clients, is considered business use, and that’s not covered by your home or renters insurance.

The damage you will be covered for will be the same as the rest of your personal property as defined as the "16 common perils". Fire, theft, vandalism, wind, these are some of the most common perils that are covered in standard renters and homeowners insurance policies. If you have an HO-5 policy(the most comprehensive homeowners policy), the damage can come from anything that is not explicitly excluded from your coverage. For example, while natural flood damage is explicitly excluded, your toddler accidentally breaking your $1,000 drone is not, so you would be covered for that damage most likely.

Liability Insurance

Your liability coverage under your homeowners or renters insurance should protect you up to your coverage limits. We recommend you contact your insurer however to make sure your particular policy covers injuries caused by drones. Another type of liability claim is an invasion of privacy claim. Most drones come equipped with cameras and other recording devices, creating the possibility that someone’s privacy is breached - even unintentionally. If a claim is brought against you, your liability coverage will provide you with legal expenses so long as the breach of privacy was unintentional. The unintentional nature of the incident may be difficult to prove however, and your insurance company may be reluctant to defend you if there is any chance you can be convicted of a crime.

How Much Does Your Homeowners/Renters Insurance Cover You For?

If your drone is damaged or lost due to a covered peril, like a fire or theft, your homeowners or renters policy will pay for repair or replacement up to the limits of your personal property coverage minus your deductible. However, some policies may put additional limits on specific types of property, such as jewelry, electronics or other high-value items. It’s a good idea to contact your insurer to see what limits—if any—apply to drones. Further, if replacing or repairing your drone would cost less than or around the same amount as your deductible, you might be better off not filing a claim because your insurance premiums may increase as a result.

If your drone does damage to someone else’s property or causes injury, or you’re sued for invasion of privacy, the liability coverage of your policy would protect you up to its defined limits. Liability coverage pays medical bills, legal costs, and costs of repairing or replacing damaged property. However, you could still end up paying out of pocket if your liability coverage isn’t enough to offset the damage or medical costs incurred.

We recommend people who have significant assets carry more liability coverage, as they have more to lose in a lawsuit. One way to increase your liability coverage is by purchasing an umbrella policy, which goes into effect after your homeowners liability coverage is exhausted.

How Do You File a Claim?

If your drone is stolen, contact the police as soon as possible to file a police report and be sure to ask for a copy of the report for your insurer and personal records. If your drone is damaged by a covered common peril, photograph the damage done to your drone as well as the source and try to preserve as much evidence as possible. Next, you’ll want to contact your insurer to submit a claim. Your insurance may cover either the actual cash value of your drone or its replacement cost--depending on the type of policy you have. If you do decide to file a claim, it also helps if you have pictures of the drone from before it was damaged.

If an accident occurs in which you could be held liable for damages or medical costs, it’s your responsibility to contact your insurer as soon as possible. Likewise, if you are sued because of an invasion of privacy, it’s equally important to contact your insurer. Keep in mind that your insurance will not cover you in any situation where you willfully caused harm or broke the law; you’ll be covered if you inadvertently record someone, but not if you’re purposely spying on them.

When filing a claim, your insurer will send you forms to fill out to document the exact nature of the claim. Be sure to preserve as much evidence as possible and provide your insurer with any correspondence from third parties, such as information from attorneys or medical costs incurred by an injured person. You may also be required to show up in court or to a deposition if a lawsuit is brought against you.

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