News & Insights

Don’t get caught out by new regulations for commercial use drones

Published 05 February 2021

The use of drones for business or commercial applications in Australia has grown exponentially ‒ and so have the risks. The Civil Aviation Safety Authority (CASA) has responded to this increased usage and the related issues by updating the regulations governing commercial use of drones, or remotely piloted aircraft (RPA). Read on to find out how this affects your business and insurance cover.


What the new drone use regulation requires

From 28 January 2021 all drones or RPA used for commercial purposes must be registered with CASA, irrespective of their size or weight. Failure to comply could cost your business up to $11,100 in fines.

How commercial use of drones is defined

Examples of commercial usage include

  • mapping and surveying
  • aerial agriculture
  • creating photos or video content to be sold
  • inspecting commercial equipment, infrastructure or sites
  • monitoring, providing surveillance or security services
  • creating content for websites where an income is generated from advertising
  • any drone activities on behalf of your employer.

If you are operating a drone for any purpose related to your business, even if it doesn’t directly contribute to earning income or providing a service, it can still be classified as commercial use.
 

commercial-use-drones-crops-regulations


Industries that use drones include but are not limited to: agriculture, chemicals, conservation, construction, deliveries, filmmaking, mining, insurance, energy, power generation, public safety, sewer maintenance.
 

Why the requirement to register drones for commercial use has been introduced

The risk of crashes is extremely high. One in 50 drones will be involved in an accident, equivalent to a crash occurring approximately every 2000 hours of operation, according to claims data from insurer QBE. Sharing airspace also carries significant risk of collisions or near misses with aircraft, especially in capital cities, the Australian Transport Safety Bureau stated in a 2017 report.

 

Liability implications for business drone operators

Under Section 10 of the Damage by Aircraft Act if a drone used commercially causes injury or property damage on the ground, the business may be subject to what is called strict liability, with no requirement for proof of fault or negligence. Third party liability could also apply if a commercial drone crash causes a bushfire with resultant damage to people or property.
 

Understanding and managing commercial drone use risks

Insurance that protects business owners who operate drones for commercial use can include cover for accidental damage to the drone and to third parties while in flight and on the ground, in addition to property insurance for the technology/non airborne equipment on the ground or in transit. If your business operates more than one drone liability cover for injury or property damage to third parties must cover each RPA.    

Operators of commercial drones weighing more than 2 kilograms are required to hold a remote pilot licence (RePL) or remotely piloted aircraft operator’s certificate (ReOC). Operators of commercial drones that weigh less than 2kg must still comply with the CASA Standard Operating Conditions. Without the correct operator accreditation certificate or RePL insurance claims for commercial drone accidents or losses could be refused, or insurance cover denied.


How we can help

Gallagher can help with insurance cover that provides for drone operators’ needs: professional indemnity and public liability insurance, as well as all-important aviation cover. This protection can be bundled with your other business insurance to provide optimal coverage.
 

Talk to us about insurance cover for commercial drones

Our advice is based on our aviation specialists’ technical expertise and practical knowledge of the risks you face in the air and on the ground. 
 

Connect with an expert

 

Further reading

Aviation insurance

What operators need to know about aviation insurance selection criteria

 


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