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05 July 2017
According to the amended Air Traffic Act, drones are recognised as aircraft. However, according to Article 1(2) of the act, only unmanned aerial systems (UAS) that are not used for hobby or recreational purposes qualify as aircraft. The operation of such UAS can require authorisation from the aviation authority of the respective German state. Usually, UAS that weigh more than 5 kilograms (kg) need such authorisation to fly. The authorisation will be granted if operation of the UAS does not present a risk to air safety or order and if rules on data protection and privacy are not violated. However, the main prerequisite for operating a UAS is the coverage of the respective risks by liability insurance.
As far as UAS are recognised as aircraft according to the act, the provisions concerning third-party liability and mandatory insurance coverage apply also to drone owners. As general liability insurance does not usually cover this specific risk, drone owners need specific liability insurance.
According to Article 33(1) of the act, there is strict liability of the drone's owner in case of bodily injury or damage to the property caused by the drone's operation, including damages caused by any object falling from a drone during flight. This means that the owner is liable regardless of fault. The owner's liability applies even if it is not the user. It can discharge itself of liability only if the operator uses the drone without the knowledge and will of the owner, and if it did not enable the operator to use the drone.
According to Article 43 of the act, as a result of this liability, the owner of a UAS is obliged to take out third-party liability insurance before taking off. The minimum insurance requirements depend on the type of UAS and its weight.
However, according to Article 37 of the act, even UAS with less than a 500kg maximum take-off mass need third-party liability insurance that covers at least 750,000 special drawing rights. Further, according to Article 113 of the Insurance Act, insurance must be provided by an insurance company that is authorised to provide insurance coverage in Germany. Proof of insurance must be provided and maintained during the operations.
A new regulation on drones came into effect in Germany on April 6 2017. Although this regulation contains no provisions regarding the enforcement of compulsory insurance, several provisions might be helpful for identifying a drone's owner.
Third-party liability insurance is compulsory. The owner does not have to take out the insurance when buying the drone; the seller only has to draw the buyer's attention to the fact that third-party insurance is required.
In the event of damage, the assertion of third-party claims depends on the honesty of the owner, since the damaged party must be able to identify the individual responsible for the drone.
From October 1 2017 all drones with a minimum take-off mass of 0.25kg must have a clear marking which contains the name and address of the owner. Owners of drones with a minimum take-off mass of 2kg will also need to prove particular skills.
A specific ascent permission from the Federal Aviation Office is required for all drones with a minimum take-off mass of 5kg.
The new regulation resolves some problems concerning the operation of drones and progress is being made regarding owner identification so that a potential claimant knows where to address a claim.
The insurance industry has discovered that the new world of drones offers an enormous market which requires many insurance solutions beyond third-party liability.
As drone equipment is expensive, loss or damage (eg, airframe or payload) is also an insurable risk. The insurance industry even provides risk insurances that cover any event of destruction, damage or loss of insured items through identified and unidentified risks, unless expressly excluded.
Further risks to which drone operators or manufacturers are exposed are numerous (eg, violation of personal rights and data protection laws). As a result, drone operations are a growing area for insurance solutions and will keep the industry busy in the future.
For further information on this topic please contact Kamila Uckat or Quirin Vergho at Arnecke Sibeth Rechtsanwaelte by telephone (+49 69 97 98 85 0) or email (email@example.com or firstname.lastname@example.org). The ArneckeSibeth website can be accessed at www.arneckesibeth.com.
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