1. Forms
2. CG
3. CG-21-09

What the Form Is

The CG 21 09 is an endorsement to the Commercial General Liability (CGL) coverage part. Its primary purpose is to explicitly exclude liability coverage for bodily injury, property damage, and personal and advertising injury arising from the ownership, maintenance, use, or entrustment to others of "unmanned aircraft," commonly referred to as drones. This endorsement modifies the existing aircraft exclusion (typically found in section 2.g. of Coverage A in the CGL form) to specifically address unmanned aircraft and also adds a new exclusion under Coverage B (Personal and Advertising Injury Liability) for unmanned aircraft. The form includes a definition of "unmanned aircraft," generally describing it as an aircraft not designed, manufactured, or modified to be controlled directly by a person from within or on the aircraft.

Classes of Business It Applies To

This endorsement is relevant to a wide range of businesses, particularly those that might own, operate, or hire others to operate drones. Examples include:

• Real Estate Agencies: Using drones for aerial photography or videography of properties.
• Construction Companies: Employing drones for site surveys, inspections, or monitoring progress.
• Photography and Videography Businesses: Offering drone-based services for events, marketing, or film production.
• Agricultural Operations: Utilizing drones for crop dusting, field mapping, or livestock monitoring.
• Delivery Services: As drone delivery becomes more prevalent.
• Event Organizers: Using drones for security, broadcasting, or entertainment.
• Any business that hires a contractor to perform drone operations on their behalf, as the exclusion can apply to such contingent liability.

Special Considerations

• Broad Exclusion: The exclusion is comprehensive and applies to most liability arising from unmanned aircraft.
• No Contractual Liability Coverage: Importantly, the endorsement does not provide an exception for liability assumed under an "insured contract" related to unmanned aircraft. This means if an insured agrees to indemnify another party for drone-related incidents, the CGL policy with this endorsement will likely not cover that assumed liability.
• Need for Specific Coverage: Businesses with drone exposures typically need to seek specialized aviation insurance or a specific buy-back endorsement, such as ISO's CG 24 50 (Limited Coverage for Designated Unmanned Aircraft), to obtain coverage.
• Regulatory Compliance: While the endorsement excludes coverage regardless of FAA compliance, businesses operating drones must still adhere to all applicable federal, state, and local regulations, including pilot certification and aircraft registration. Non-compliance can lead to fines and other penalties.
• Definition is Key: The policy's definition of "unmanned aircraft" is crucial in determining the scope of the exclusion.

Key Information for Agents and Underwriters

• Risk Identification: Agents and underwriters must proactively identify any potential drone exposure an insured may have. This includes inquiring about direct ownership and operation, as well as the use of drones by subcontractors.
• Coverage Gap Communication: It is critical for agents to clearly communicate the coverage limitation imposed by this endorsement to insureds with any drone-related activities. Failure to do so could lead to errors and omissions claims.
• Underwriting Appetite: Underwriters may mandate this endorsement for risks with significant, unmitigated, or undesirable drone exposures if they do not offer specialized drone coverage. The presence of this exclusion clarifies that the standard CGL is not intended to cover these risks.
• Alternative Solutions: If an insured requires coverage for drone operations, agents should explore options such as dedicated unmanned aircraft liability policies or endorsements like CG 24 50, which can provide limited coverage for specified aircraft and operations, often subject to a separate aggregate limit.
• Historical Context: This endorsement was introduced by ISO around 2014-2015 to address the growing use of drones and provide clarity, as the traditional aircraft exclusion in CGL policies was not specifically designed for unmanned systems.