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Drone Use in the Construction Industry

The construction industry has quickly become the fastest-growing commercial adopter of drones, taking advantage of the technology’s vast aerial vantage point, data-collecting abilities, and more. As projects become more complex and demand increases, operators are utilizing drones to not only survey land and generate topographic maps but to track equipment, provide clients with progress reports of projects, survey job sites, ensure personnel safety, and more. Read on to learn about important regulations surrounding drone use on construction sites and how your operation can protect itself when utilizing drone technology.


The Regulation of Drones


Drones are still considered aircraft and must be registered with the FAA unless a recreational drone meets all of the FAA’s requirements to fall under the agency’s special rule for model aircraft. Here are the basic guidelines for registering drones:


  • Drones that don’t fall under the FAA’s special rule for model aircraft and weigh between 0.55 pounds and 55 pounds must be registered online. Commercial drones that weigh more than 55 pounds must be registered by paper.

  • Once registered, the drone operator will receive a registration number that must be placed on all applicable drones.

  • Registration is valid for three years. Failing to register may result in regulatory and criminal sanctions.


Two construction workers operate a drone over a construction site.

The FAA has separate regulations for recreational and commercial drones, although some of the regulations are similar. The following is a list of key FAA requirements for recreational drones:


  • Operators must maintain a visual line of sight with their drones, and keep them below a height of 400 feet above ground level.

  • Drones cannot fly within 5 miles of an airport without the operator first notifying the airport and air traffic control tower. Operators must always yield the right of way to manned aircraft.

  • Drones cannot be flown over stadiums, sporting events, or people who aren’t directly participating in the flight’s operation.

  • Operators must follow all local drone safety guidelines and keep their drones away from emergency response efforts at all times.


Here is a partial list of key FAA requirements for commercial drones:


Commercial drone operators need a remote pilot airman certificate with a small drone rating or be under the direct supervision of a person who holds such a certificate.


  • The remote pilot must inspect drones before every flight.

  • Operators must maintain a visual line of sight with their drones, and keep them below a height of 400 feet above ground level.

  • Operators cannot fly the drone over anyone who is not directly participating in the drone’s operation.

  • Drones may carry an external load if it’s securely attached and doesn’t adversely affect the controllability of the aircraft.


For more details on the FAA rules regarding the commercial use of drones, visit the FAA’s website.


Looking Beyond Casualty & Liability


As with conventional aircraft, a drone crash could mean a hefty casualty claim. While the crash rate is actually relatively low with conventional aircraft, drones are not subject to the tight maintenance requirements or the stringent operator regulations that make conventional commercial aircraft crashes so rare.


Eventually, mechanical failures and operator errors will likely result in crashes. Businesses, especially those that operate drones in populated areas, should make sure they are adequately covered in the event of property damage or injury to a third party.


According to the International Risk Management Institute, Inc., drones present most of the same risks as other forms of aircraft, but on a smaller scale. For most commercial drone users, the most likely losses include:


  • Injury or damage due to collision or interference with another aircraft

  • Injury or damage to people or property on the ground

  • Damage to the unmanned aircraft

  • Violation of another’s rights when flying over private property

  • Unauthorized collection, use, or storage of data


Standard commercial property and liability policies do not cover most of the events noted above, so unless other coverage has been purchased, companies that use drones to conduct business likely have uninsured exposures.


To address this issue, endorsements can be added to an existing property policy to provide coverage for first-party property damage (damage to the drone itself) and to an existing general liability policy to provide third-party coverage (bodily injury or property damage suffered by another person). Alternatively, a standalone aviation policy can provide both first-party and third-party coverage. Oftentimes, a specific endorsement is required to provide coverage for privacy and data violation claims.


Questions? Reach out to a Cottingham & Butler representative today to get more information on how you can protect your business.

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