Kennedys responds to CAA consultation on drones urging more insurance and legal stakeholder engagement

On 10 January 2024, Kennedys submitted a response to the latest consultation from the Civil Aviation Authority (CAA) on proposals to reform the regulations around drone use.

The consultation states that the aims of these proposals include making it easier to comply with unmanned aircraft systems (UAS) regulation and to make greater use of technical mitigations such as geo-fencing functionality. Our position is that the application and interpretation of these regulations in a legal and insurance context are integral elements to meeting these aims, and to ensure the future success of these regulations.

Scope of consultation

We welcome the CAA’s continued focus on ensuring that the UK’s UAS regulations are fit for purpose. We understand and agree with the need to consider drone users’ understanding of the regulations and the safety aspects related to technical mitigations. However, the scope of this consultation does not extend to insurance requirements or to sharing of data, which we believe is vital for the future-proofing of this regulatory framework.

Kennedys’ response

As the most recent consultation was focused on the technical elements of the existing regulations, we took this opportunity to reiterate the need for the CAA to consider:

• The need for increased dialogue with the legal and insurance sector.
• The changes required to the existing legal framework and insurance requirements for both consumers and manufacturers.
• Mandatory insurance for routine flights beyond visual line of sight (BVLOS).
• The availability of anonymised data to insurers captured by any Flight Information and Notification system (FINS) that is introduced.

FINS data

The insurance industry would benefit from access to data available from any FINS that is introduced. Such a system would capture all drone flight data in the UK and contain invaluable information about the types of flights, their duration, their purpose, and the frequency of flights BVLOS. The availability of this data would help assist insurers when assessing risk.

The consultation highlights the CAA and the Airspace Modernisation Strategy’s shared visions, including proposals to enable routine BVLOS operations and promote the integration of UAS into our airspace. The insurance requirements for UAS users intending to fly BVLOS, especially on a ‘routine’ basis, will need to be carefully considered by the CAA and the Department for Transport (DfT). The sharing of anonymised FINS data will greatly assist the monitoring and responding to this practice, with careful consideration of the potential implementation of mandatory insurance for such routine flights.

Comment

By reviewing and updating the existing regulation, the CAA and the DfT have the opportunity to put in place the necessary framework to assist UAS users, manufacturers and insurers, thereby ensuring the sector’s future success. This includes the need for the new regulations to be clear and unambiguous, so that these can be relied upon within insurance policies.

The risks of potential claims - whether third party claim or hull claims - are likely to increase significantly with routine UAS BVLOS flights. The data captured by the FINS technology will be of upmost importance to insurers pricing these evolving risks. This is why we are strongly in favour of anonymised data being widely available.

This is an area that is rapidly developing, and regular conversations with all stakeholders will be needed to ensure that the regulatory framework keeps pace with the constantly evolving technology and use of drones.

Related item: Insurers have an opportunity to shape drone regulation

Read other items in London Market Brief - February 2024