A lack of clear guidance applicable to the commercial use of drones continues to hamper the development of the technology and its applications, the National Association of Mutual Insurance Companies said today during a House Judiciary subcommittee hearing.
In testimony before the Subcommittee on Courts, Intellectual Property, and the Internet, Tom Karol, general counsel for federal affairs at NAMIC, explained that a marketplace for insuring drones, technically known as unmanned aircraft systems, is not developing because there are no standards to determine if a drone is being appropriately piloted or where liability would exist in the case of an incident.
“Until standards of liability are better defined, it will be extremely difficult for insurance companies to adequately provide coverage for risks associated with the operation of drones,” Karol said. “Furthermore, those standards must be appropriately integrated into an existing system of privacy and property rights at the federal, state, and local levels.”
In addition to delaying insurers from providing liability coverage for the commercial use of drones, a lack of regulatory guidance has also hindered insurance companies interested in exploring the use of drones to appraise property, evaluate risk, and assess damage more safely, quickly, and accurately for policyholders. “UAS can significantly reduce, if not eliminate, the dangers inherent in important tasks that now put our insurance personnel in precarious positions, including roof inspection, damage assessment, and disaster response,” Karol said.
Although the Federal Aviation Administration released proposed regulations governing the commercial use of drones earlier this year, insurers have significant concerns about unaddressed issues relating to privacy surrounding the expanded use of UAS.. The National Telecommunications and Information Administration has begun working with stakeholders, including NAMIC, to establish best practices for privacy protections regarding drone use, but Karol noted that significant questions remain as to how such practices, or the FAA’s regulations, will mesh with various state and local property and privacy laws.
“More and more sectors are contemplating the use of drones, but regulations and laws in the U.S. have not kept up,” Karol said. “Reasonable, effective, and efficient regulation of the commercial use of UAS is not only possible but should be a primary goal of policymakers at all levels of government.”
Director, Federal Public Affairs