How to Insure a Flying Robot

The drone industry is taking off, but the insurance industry is still many years behind. Here at Flock, we’re doing things a little differently…

This post has been adapted from my original post on Medium. See it here.

The commercial drone industry is booming. Drones are proving their worth in agriculture, photography, industrial inspections, and it seems almost every day there’s a new use-case. It’s no surprise that the industry is projected to be worth $127Bn by 2020, and that major players like Facebook, Google and Amazon are getting stuck in. Non-commercial drone flights are on the up, too; 2.5M hobbyist drones will be sold this year in the US alone.

The Risks

Drones have their risks, however. As you may have guessed, taking a metal robot, equipping it with spinning rotor blades, and hovering it 400ft in the air, brings with it a number of potential downsides. Downsides such as colliding with airplanes and disrupting commercial airline services, smashing into office towers, and even landing on competitive skiers. It seems barely a day goes by without a drone-related incident making headline news.

The Insurance Problem

Drone risks are difficult for pilots to identify when planning a flight (even for professionals). These risks are harder still for insurance companies to quantify — after all, insurers have no visibility into what pilots are actually doing with their drones, and the industry is relatively new (so there isn’t much historical data to go on).

The result: outrageously priced (but often compulsory) insurance premiums for drone pilots, which can cost more than the drones themselves — sometimes reaching thousands of pounds per year. Most drone insurance policies are just as cumbersome, complicated, and un-innovative as they are in other industries, and they’re inflexible too, tying pilots in for an entire year.

And that’s where Flock comes in…

Introducing Flock Cover: Pay-As-You-Fly Drone Insurance

Here at Flock, we’re redesigning insurance from the ground up, using cutting-edge data science to intelligently price, customise, and sell drone insurance policies. Instantly. And we’re kicking things off with a mobile app called Flock Cover that’s so simple, even our grandparents can use it (seriously — we tested it).

With Flock Cover, you’ll pay for drone insurance only when you need it, and instantly receive a fully-customised policy for your flight. Our real-time pricing is risk-dependent, so the safer your flight, the less you pay. And if something does go wrong? No need to worry. Claims are made from inside the app, with the tap of a button. It really is that simple. Oh: and it starts from £5 per hour for commercial pilots.

How Does It Work?

There’s a lot of complex technology behind this simple app. Here’s a quick breakdown:

Step 1: We Collect Data.

‘Big-Data’, even. This includes things like: who you are as a pilot, your drone specs, and your surrounding environment. Is it windy? Are you flying near a school? An airport? All these factors contribute to how risky your flight is, and we’ve partnered with world-leading data providers to collect this information in real-time.

Step 2: Feed the Algorithms.

All this data needs to be put to work (in the cloud, of course). We feed it into algorithms that accurately calculate the risk of your drone flight. We didn’t just write these algorithms on a whim, though; we work with world-leading drone industry experts, who help us build and maintain them.

Step 3. Quantify Drone Flight Risk.

In under half a second our algorithms generate a single number that represents how risky your drone flight is. We provide you with a full breakdown of what these risks involve, so there aren’t any unexpected surprises. And the app advises you on how to fly safely, displaying these risks on an easy-to-read map.

The Result: Pay-As-You-Fly Drone Insurance.

Flock’s risk metric is converted into an insurance premium — that’s the price of insuring your drone flight for damage to your equipment, up to £10M third-party liability cover, and more. Then all it takes is two taps on your smartphone to insure your flight; your policy documents are drawn up automatically, and arrive straight into your email inbox.

And you can rest assured that if something goes wrong, you’re in the safest possible hands; all of our policies are underwritten by Allianz, the world’s leading aviation insurer.

On-Demand Insurance is the Future

We’re now accustomed to ordering taxis, food, and even dates at the touch of a button. It only makes sense that the insurance industry steps up its game to offer the same on-demand service, even for something as complex as a flying robot. As recently highlighted in The Economist, Flock is using Big-Data to unlock the future of on-demand insurance for drones (…and beyond!).

The days of paying hefty annual premiums — or spending hours on the phone to an insurance broker — are behind us. It’s time we put insurance back into the only hands that matter: yours.

Safe flying!