1. Forms
2. CG
3. CG-21-10

What the Form Is

The CG 21 10 is an endorsement issued by Insurance Services Office, Inc. (ISO) for use with the Commercial General Liability (CGL) Coverage Part. Its primary purpose is to exclude coverage for 'bodily injury' and 'property damage' liability (Coverage A) that arises from the ownership, maintenance, use, or entrustment to others of any 'unmanned aircraft'. 'Unmanned aircraft' are more commonly referred to as drones. This endorsement helps insurers manage the evolving risks associated with the increasing use of drones in various commercial activities.

Classes of Business It Applies To

This endorsement can be applied to a wide range of businesses across various industries where there is an exposure to drone usage, and the insurer wishes to exclude Coverage A liability for such usage. Real-world examples include:

• Construction: Companies using drones for site surveys, inspections, or monitoring progress.
• Real Estate: Agencies using drones for aerial photography or videography of properties.
• Agriculture: Farms or agricultural businesses employing drones for crop spraying, monitoring, or mapping.
• Media and Entertainment: Businesses using drones for filming, news gathering, or event coverage.
• Retail and Delivery: Companies experimenting with or using drones for delivery services.
• Public Entities: Municipalities or public agencies using drones for surveillance or inspections.
• Any business whose employees or contractors might operate drones as part of their work or incidentally on the business premises.

Special Considerations

• Coverage A Specific: It's crucial to note that this endorsement applies only to Coverage A – Bodily Injury and Property Damage Liability. It does not, by itself, exclude coverage for Personal and Advertising Injury (Coverage B) that might arise from drone use (e.g., invasion of privacy claims). For a broader exclusion covering both Coverage A and B, endorsement CG 21 09 would be used. For an exclusion specific to Coverage B, CG 21 11 is available.
• No Coverage for Drones: Attaching this endorsement means the CGL policy will not respond to claims for bodily injury or property damage caused by the insured's drones or drones operated on their behalf.
• Definition of 'Unmanned Aircraft': The policy or endorsement series typically includes a definition of 'unmanned aircraft' to clarify the scope of the exclusion.
• Alternative for Coverage: If an insured requires coverage for their drone operations, this exclusionary endorsement should not be used. Instead, endorsements such as CG 24 50 (Limited Coverage For Designated Unmanned Aircraft) or CG 24 51 (Limited Coverage For Designated Unmanned Aircraft - Coverage A Only) might be considered, or a separate aviation liability policy may be necessary.

Key Information for Agents and Underwriters

• Risk Assessment: Underwriters must carefully assess the insured's current and potential use of unmanned aircraft. This includes understanding the types of drones used, the purpose of their use, operator qualifications, and areas of operation.
• Clear Communication: Agents must clearly explain the impact of this endorsement to the insured. The insured needs to understand that if this endorsement is attached, they will have no bodily injury or property damage liability coverage under the CGL for incidents arising from drone use.
• Identifying Coverage Gaps: If an insured uses drones, applying this exclusion creates a significant coverage gap for that exposure. Agents should discuss alternative risk transfer options, such as specialized drone liability insurance.
• Pricing Implications: While the endorsement itself is an exclusion, its use reflects an underwriting decision to not cover a specific risk, which can impact the overall acceptability and pricing of the CGL policy by removing an otherwise potentially significant and complex exposure.
• Interaction with Umbrella/Excess Policies: If CG 21 10 is attached to the primary CGL policy, it's important to ensure that any commercial umbrella or excess liability policies align. Endorsement CU 21 72 (Exclusion – Unmanned Aircraft (Coverage A Only)) is designed for umbrella policies to track the exclusion in the underlying CGL.
• Regulatory Environment: Stay aware of the evolving regulatory landscape for drone operations (e.g., FAA regulations in the U.S.), as this can impact liability exposures.