1. Forms
2. IH
3. IH-99-29

What the form is

The IH 99 29 01 16, Limited Coverage For Unmanned Aircraft Property, is an Insurance Services Office (ISO) endorsement. Its primary purpose is to provide specific, limited property coverage for unmanned aircraft, commonly known as drones. This form is used in conjunction with other standard commercial inland marine forms to address the unique risks associated with drone ownership and operation. It covers direct physical loss or damage to the unmanned aircraft itself. Importantly, this endorsement does not provide coverage for any cargo or goods carried by the unmanned aircraft.

Classes of business it applies to

This endorsement is relevant for a variety of businesses that utilize drones in their operations. Examples include:

• Construction: Contractors using drones for site surveys, inspections, or monitoring progress. For instance, a roofing contractor might use a drone to inspect a steep roof.
• Real Estate: Agents using drones for aerial photography and videography of properties.
• Agriculture: Farms using drones for crop monitoring, spraying, or mapping.
• Photography/Videography: Professionals using drones for commercial photo or video shoots.
• Surveying and Mapping: Businesses that use drones for land surveying or creating detailed maps.
• Infrastructure Inspection: Companies inspecting bridges, power lines, or pipelines with drones.

It can be endorsed to the Contractors Equipment Coverage Form, Machinery And Equipment Coverage Form, and the Miscellaneous Articles Coverage Form.

Special considerations

There are several important points to consider when using this form:

• Exclusion of Cargo: As explicitly stated, this form does not cover cargo carried by the drone. Businesses needing coverage for drone-carried cargo would need to seek a different form, such as the IH 00 61 (Unmanned Aircraft Property and Cargo Coverage Form).
• Scheduled vs. Blanket: Coverage can be written on a blanket or scheduled basis.
• Additionally Acquired Property: The form provides minimal coverage for newly acquired unmanned aircraft (the lesser of 25% of the limit or $50,000) for up to 30 days or until the policy period ends, whichever is first. The insured must report these acquisitions and pay additional premium for coverage to continue.
• Excluded Activities: The form is not intended to cover reckless activities such as racing or stunts. It also generally applies to property while the insured is using it, not while it is loaned, leased, or rented to others without specific endorsement.
• Unexplained Disappearance: Losses due to unexplained disappearance (e.g., misplacing the remote control) are not covered.
• Mechanical Breakdown: While direct loss from mechanical breakdown, failure, or malfunction is not covered, ensuing damage from a covered cause of loss may be.

Key information for agents and underwriters

Agents and underwriters should pay close attention to the following:

• Valuation: Proper valuation of the unmanned aircraft and any attached operational equipment is crucial for determining adequate limits.
• Usage: The intended use of the drone is a key underwriting factor. Commercial operations in congested areas or for high-risk activities may require more scrutiny.
• Operator Experience: The experience and training of the drone operators can significantly impact the risk profile.
• Loss Control: Underwriters should consider factors like whether the drone is commercially manufactured or built from a kit, its age, maximum speed, flight radius, typical altitude, flight duration, and payload capacity.
• Associated Forms: This endorsement must be used with the Commercial Inland Marine Conditions Form (CM 00 01) and the Common Policy Conditions Form (IL 00 17). Ensure these are correctly attached and any necessary declarations are completed.
• Coverage Gaps: Clearly communicate the limitation regarding cargo coverage and other exclusions to the insured to avoid misunderstandings at the time of a claim.