Drone Insurance Policy

In News

• Recently, various companies such as HDFC Ergo, ICICI Lombard, Bajaj Allianz, and Tata AIG and public sector companies such as New India Assurance have launched its unmanned aircraft system insurance.

Drone market in India

• India’s potential: Drones and allied component industries can boost India’s manufacturing potential by approximately $23 billion by 2030.
• Market size: India’s drone manufacturing industry crossed annual sales of Rs 60 crore in FY 2021 and is expected to grow to Rs 900 crore by FY 2024. 

Drone Categories

• Nano: Less than or equal to 250 grams.
• Micro: Greater than 250 grams and less than or equal to 2 kg. 
• Small: Greater than 2 kg and less than or equal to 25 kg.
• Medium: Greater than 25 kg and less than or equal to 150 kg.
• Large: Greater than 150 kg.

Drone flying restrictions in India

• A micro drone may not fly higher than 60 metres above ground level (AGL) or faster than 25 metres per second.
• A small drone may not fly higher than 120 metres above ground level or faster than 25 metres per second.
• Drones that are medium or large must fly in compliance with the conditions outlined in the DGCA’s Operator Permit.
• Prohibited zones are completely off-limits, whereas restricted areas require prior approval from the DGCA.

Area to fly a drone

• Yellow (controlled airspace).
• Green (no permission required).
• Red (flying not permitted). 

Major Highlights of the insurance policy 

• Regulation: 
  • Insurance players are now offering drone coverage within the framework set by the Insurance Regulatory and Development Authority of India (IRDAI).
• Participants: 
  • It will cover large aircraft to solo flying gliders. 
  • It will be offered to drone owners, operators, and manufacturers.
• Policy coverage:
  • The policy covers physical damage to the aircraft and its theft. 
  • It also provides cover for accidental physical injury to the third party and/or damage to their property due to the aircraft’s operations.
  • It is designed to cover fixed wing, rotor wing and hybrid UAS that can be controlled remotely (with pilot intervention) or autonomous drones (without pilot intervention).
    • These aircraft are generally deployed for military and non-military applications, including surveillance, geography and infrastructure inspections and aerial photography.
  • It will provide coverage for the replacement or repair, accidental loss of or damage to the UAS arising from the risks covered, including disappearance if the UAS is unreported after the commencement of Flight.
• Third-party liability coverage 
  • It will cover legal liabilities like bodily damage or property damage claims to third parties arising out of the usage and operation of drones. 

Regulations in the sector

• Flying drones has been legalised in India since 2018: 
  • However, individuals need to take prior permission from civil aviation regulator DGCA to fly these remote-piloted aircraft. 
  • Nano drones, weighing less than 250 grams, have a permit exemption, subject to the condition they are flown at an altitude below 50 feet.
• The Director General of Civil Aviation (DGCA) initially offered coverage to drones within a visual line of sight (VLOS) and during the day. 
  • Later on the DGCA changed the guidelines to offer coverage beyond VLOS.
• DGCA mandates third-party liability insurance for all drone operators. Whether you are operating a drone for commercial purposes, or personal use, flying without insurance is illegal and can lead to severe consequences. 
• Except in the nano category and micro category only for non-commercial use, all drone activities must be done only after receiving prior approval from the Digital Sky online platform for a flight or series of flights. 
• Globally: drones are classified as aircraft and aviation regulators have already stepped in to regulate the sector. 
  • The Government of India has brought in policies (Drone Policy 1.0 in 2018 and Drone Policy 2.0 in 2019) which made the DGCA to come out with Regulations Civil Aviation Regulation CAR 1.0 in 2018 and Draft Unmanned Aerial Vehicle Systems, 2020.

Way Forward

• The aim is to Make India the drone hub of the world.
  • There is a need for innovative and competitive manufacturing capabilities and a strong action plan to help India become a global hub for drone manufacturing by 2030.
• Need of the hour is to generate a strong demand, increasing manufacturing, drawing investments and facilitating exports.
• The government is carving out drone corridors to facilitate delivery of cargo deliveries.

Source: IE