1. Forms
2. FP
3. FP-04-30

What the Form Is

The FP 04 30 Limited Coverage for Unmanned Aircraft (Scheduled and/or Blanket Coverage) is an endorsement used with farm property insurance policies. Its primary purpose is to provide direct physical loss or damage coverage for unmanned aircraft, commonly known as drones, that are owned by, rented, or leased to the insured (if they have a contractual responsibility to insure them). Coverage can be applied on a scheduled basis (listing each aircraft individually) or on a blanket basis for multiple aircraft. The form specifies that "unmanned aircraft" includes equipment used exclusively with the craft as long as it's essential to its operation or scheduled operations. Coverage applies both on and off the "insured location" but within the defined Coverage Territory. It also includes coverage for debris removal of the damaged unmanned aircraft if the loss is covered.

Classes of Business It Applies To

This endorsement is specifically designed for agricultural businesses and farm operations that utilize unmanned aircraft for various purposes. Examples include:

• Farms using drones for crop monitoring, aerial photography of fields, or surveying land.
• Agricultural businesses employing drones for livestock monitoring.
• Operations using drones for inspecting farm structures or equipment.

The schedule requires a description of the "unmanned aircraft" operations, which notably does not include delivery to others.

Special Considerations

• Scheduling is Key: Detailed information must be provided in the schedule, including the insured location, a description of the unmanned aircraft operations, a description of each scheduled aircraft with its limit of insurance and valuation method (Actual Cash Value or Replacement Cost). If blanket coverage is chosen, the blanket limit and any sub-limit per aircraft, along with the valuation method, must be specified.
• Deductible and Other Limits: A deductible applies to losses. The schedule also requires a limit for "electronic media and records".
• Newly Acquired Property: There is an option to elect coverage extension for newly acquired unmanned aircraft.
• In-Flight Coverage: Coverage for loss or damage occurring while the unmanned aircraft is in flight, in preparation for flight, or being launched/landed is provided if caused by a Covered Cause of Loss.
• Exclusions: Loss or damage caused by mechanical breakdown, malfunction, or failure to operate is not covered, unless the breakdown or failure results from a Covered Cause of Loss. It's important to note that certain exclusions found in the base Causes of Loss Form – Farm Property (FP 10 60) or the Mobile Agricultural Machinery and Equipment Coverage Form (FP 00 30) may not apply to unmanned aircraft under this endorsement if the loss results from fire, explosion, or collision during scheduled operations.
• Valuation: The valuation clauses in the Farm Property – Farm Personal Property Coverage Form (FP 00 13) and Mobile Agricultural Machinery And Equipment Coverage Form (FP 00 30) are replaced by the valuation provisions within this endorsement for covered unmanned aircraft. If Actual Cash Value (ACV) is shown in the schedule, losses are settled at ACV at the time of loss, not exceeding the amount to repair or replace the property.

Key Information for Agents and Underwriters

• Underwriting Flexibility: This form is designed to offer flexibility in underwriting drone-related property exposures for farm risks.
• Accurate Scheduling: Ensure the insured provides a complete and accurate schedule. This includes a clear description of operations, individual aircraft details (if scheduled), appropriate limits, and the chosen valuation method (ACV/RCV).
• Define "Unmanned Aircraft Operations": Clarify with the insured what their drone operations entail to ensure they align with the coverage intent (e.g., no coverage for delivery operations).
• Interaction with Base Forms: Understand that this endorsement modifies existing coverage forms (FP 00 13, FP 00 30, FP 10 60, FP 00 90). Review these forms in conjunction with FP 04 30.
• Property vs. Liability: This endorsement addresses property damage *to* the unmanned aircraft itself. Liability exposures arising from the use of drones would typically need to be addressed under a separate liability coverage form or endorsement.
• Coverage Territory: Confirm that the insured's operational footprint for the drones falls within the policy's Coverage Territory.