On behalf of all of us here at GWB Insurance, we want to wish you a safe and happy 4th of July! In observance of the holiday our office will be closed on Monday July 3rd and Tuesday July 4th.
The rise in recreational uses of drones (more accurately described as Unmanned Aerial Systems or just “UAS”) has sparked much debate, including concerns over safety and privacy. The scenarios are rather simple to envision: Suppose a person insured under a standard homeowners’ insurance policy uses a small camera-equipped UAS, purchased online for less than $1000, and unexpectedly crashes it into a neighbor’s car, or uses it to take pictures of a neighbor’s children playing in their backyard. If the neighbor pursues a claim against the UAS operator for property damage or personal injury, to what extent, if any, is coverage provided by the UAS operator’s homeowners’ insurance policy? This article seeks to answer that question.
Recreational Drone Use has Increased
Years ago when most people thought about a drone or UAS, the image of a large missile-yielding military machine designed to spy on and target national security threats in the Middle East likely came to mind. Now, however, people are becoming more familiar with the small recreational UAS equipment, which uses a four-to-eight blade propeller designed to take off and land vertically while being powered with a small battery and controlled remotely by a handheld device. This growing familiarity is due to the rapid increase in the production and sales of affordable UAS equipment for recreational users. In fact, the Consumer Electronics Association predicted consumer UAS sales will increase almost 50 percent this year (at least 300,000 more sales than last year), according to a January 31, 2015, Forbes article by Gregory S. McNeal, Will Recreational Drone Flying Lead Drone Usage in 2015? The increases are due in large part to rapid technological advances, including the miniaturization of the sensing, localization and control technologies inside UAS, reported Daniel Simmons, in an article titled Attack of the Consumer Drones, published by the website Thrive Detroit on July 7, 2015.
Potential for Bodily and Personal Injury and Property Damage Exists
With the rise in popularity, availability, and use of recreational UAS equipment – paired with the FAA’s lenient guidelines – it undoubtedly follows there will likely be an increase in UAS-related accidents. For example, during a TGI Friday’s promotion in December 2014, a drone crashed into a woman’s face, clipping her nose and her chin. The incident made Conner Forrest’s list of the 12 Drone Disasters that Show Why the FAA Hates Drones, published by TechRepublic on March 20, 2015. Another example is the UAS that crashed into the Grand Prismatic Spring in Yellowstone National Park in September 2014, which officials feared could endanger the spring. These examples raise the question: To what extent are recreational UAS operators covered by their homeowners’ insurance policies?
Homeowners’ Policies May Cover Recreational UAS Use
The short answer to whether harm caused by the recreational use of a UAS is covered by a standard homeowners’ insurance policy is, “probably yes.” However, as with every insurance coverage issue, the availability of coverage depends on the specific policy’s language – including the grant of coverage, the definitions, the exclusions, the exceptions to the exclusions and other conditions.
The standard homeowners’ policy provides coverage for damages the insured becomes legally obligated to pay because of bodily injury or property damage arising from an occurrence to which the policy applies. See, e.g., Metro. Prop. and Cas. Ins. Co. v. Gilson, No. 09-CV-1874, 2010 WL 2721906, at *1 (D. Ariz. July 7, 2010). Absent extenuating circumstances, there is no doubt this broad grant of coverage initially extends insurance for liability arising from recreational UAS operations. However, this broad coverage may, of course, be limited by policy exclusions.
Most homeowners’ policies exclude liability for injuries or damages arising out of the ownership, maintenance, operation, use, loading, or unloading of “aircraft.” See, e.g., Id.; Aridas v. Royal Ins. Co. of Am., 462 F. Supp. 2d 76, 77 (D. Me. 2006); Hanover Ins. Co. v. Showalter, 561 N.E.2d 1230, 1231 (Ill. App. Ct. 1990); Tucker v. Allstate Tex. Lloyds Ins. Co., 180 S.W.3d 880, 884 (Tex. App. 2005). The critical question of whether harm caused by a recreational UAS operation is covered under a standard homeowners’ policy depends on how the term “aircraft” is defined. Our research reveals that at least some homeowners’ policies define “aircraft” as “any device used or designed for flight, except model or hobby aircraft not used or designed to carry people or cargo.” See, e.g., Tucker, 180 S.W.3d at 884. To the extent a UAS operator’s homeowners’ policy includes this definition, or some similar variation, harm caused by an insured’s UAS is likely covered because a UAS will probably be deemed “a model or hobby aircraft not used or designed to carry people or cargo.”
It is also important to recognize that most homeowners’ policies exclude coverage for business activities. Hence, most homeowners’ insurance policies will not provide coverage for harm associated with commercial use of UAS equipment, at least according to Andrew Amato in a June 2014 article published by DroneLife titled Does Your Homeowner’s Insurance Cover Your Drone?
The line between recreational and business uses may not always be crystal clear, but insureds who receive compensation for their UAS use will probably jeopardize their homeowners’ coverage. For example, taking photographs with a UAS for personal use is likely considered recreational. Conversely, taking photos for a realty listing for a fee or as a part of a part time real estate brokerage business is not likely considered recreational.
Invasion of Privacy Claims and Your Homeowners’ Insurance Policy
Another major concern with emerging recreational UAS operations is privacy because cameras are often attached to most UAS equipment. Simple precautions, such as gaining consent before filming, can avoid breaching someone’s reasonable expectation of privacy, writes Chris Proudlove in Unmanned Aviation Risk Management, Accident Prevention and Insurance. However, not all recreational uses will be conducted in a responsible and ethical manner, and there will undoubtedly be invasion of privacy claims against UAS operators in the future.
Some homeowners’ policies may provide coverage for invasion of privacy claims resulting from the UAS operations. Coverage should be available if the policy includes liability for “personal injury,” normally defined as injuries due to false arrest, detention, malicious prosecution, libel, slander and invasion of privacy, according to Rough Notes, Policy Form & Manual Analysis,§420.4-3 (2004). If initial coverage is established, an insurer must look to see if any exclusions apply, most notably the aircraft and intentional act exclusions.
A potential coverage issue that might arise in UAS-related invasion of privacy claims is whether the intentional act exclusion applies. Most homeowners’ policies, in some variation or another, exclude coverage for injuries expected or intended by the insured. See, e.g., W. Protectors Ins. Co. v. Shaffer, 624 F. Supp. 2d 1292, 1295 (W.D. Wash. 2009); Bailer v. Erie Ins. Exch., 687 A.2d 1375, 1378 (Md. 1997). An insurer might argue that the alleged invasion of privacy with a UAS was an intentional act by the insured, as opposed to negligent, and thus, there is no coverage. This argument’s success depends, in large part, on the insured’s specific conduct, the language of the “personal injury” coverage grant, the intentional acts exclusion, and the elements necessary to sustain an invasion of privacy claim.
Some jurisdictions, such as Washington, recognize invasion of privacy claims as purely an intentional tort. W. Protectors Ins. Co.,624 F. Supp. 2d at 1301. In these jurisdictions, the grant of coverage for invasion of privacy, an intentional tort, would directly contradict the exclusion for intentional acts. Courts have determined the coverage grant trumps the exclusionary language and find coverage in the insured’s favor. On the other hand, if the jurisdiction recognizes invasion of privacy claims in other forms, such as negligence, and the complaint alleges an intentional act, then an insurer might be able to avoid coverage because the grant of coverage would not be illusory as the policy would cover negligent invasion of privacy while excluding intentional invasions of privacy. See Bailer, 687 A.2d at 1381.
Given the increase in recreational UAS operations, there will be an increase in claims against UAS operators for accidents that cause both bodily and personal injury, as well as property damage. We predict that – in the near term – insurers will see a significant increase in recreational UAS operators seeking coverage under existing homeowners’ insurance policies. Insurers of UAS operators should familiarize themselves with their policy’s exclusions and see if their policies include an exception from the definition of “aircraft” for any model or hobby machines that fly. They should also evaluate their exclusion for commercial operations and intentional torts – to see if they apply to their insureds’ UAS operations.
Tom Schrimpf is a partner with Hinshaw & Culbertson LLP. He focuses his practice on insurance coverage and commercial litigation. He has prosecuted and defended insurance coverage litigation related to all types of commercial and personal claims, D&O and professional liability. Contact Schrimpf at firstname.lastname@example.org.
Russ Klingaman is a partner with Hinshaw & Culbertson LLP and immediate past-president of the Lawyer-Pilots Bar Association. He focuses his practice on aviation law, commercial litigation, insurance coverage, insurance defense, intellectual property and product liability. He leads the firm’s national Aviation Law Team. Klingaman can be reached at email@example.com.
As the season’s change we wanted to point out what a difference a few months make. The top photo show’s a photo taken this week and the lower photo was taken a few months back when our tree unexpectedly fell and yes of course insurance covered it. On behalf of all of us at GWB Insurance, we wish everyone a happy spring!
Parting is such sweet sorrow—especially when it’s with a tool that was supposed to make auto insurance comparison shopping so much better. We’re talking about Google Compare—the formidable partnership between Google, Compare.com, CoverHound, and ITC that launched in March 2015 and is now purportedly closing up shop.
In the past couple days, word has been spreading that Google is pulling the plug on its plunge into auto insurance comparison shopping as well as its comparison tools for bank and mortgage products and credit cards. The shutdown is supposedly happening because of roadblocks by car insurance companies and regulators. It’s also been circulating that Google wants to refocus on improving consumer product sites and the “customer experience.” Another rumor is that in the nine months since launching Google Compare, it has only spread to a handful of states when it was supposed to be in the double digits by now.
“We can’t integrate as quickly with companies as fast as we thought. We can’t get the regulators to say yes to everything we demand. When we get a company to embrace the idea of online shopping, they say ‘This is terrific. We’re all in. Let’s start in Iowa,” according to Brian Sullivan, editor for Risk Information, recalling a conversation with a Google Compare executive.
Whatever the real reason, it’s caused Google to put a halt on its work toward an online auto insurance comparison site—temporarily or permanently.
What does this mean for the auto insurance world? If you’re an independent auto insurance agent, it could be very happy news. When the news first broke that Google was entering the car insurance market, CEO of W.R. Berkley Corp., William R. Berkley, said independent agents should, “be afraid, be very afraid.”That’s because Google is an internet giant that is deep into the development of its very own self-driving cars. Google knows the traffic rules, hazards, and details of every backroad, highway, and turnpike in America. That gives the company the ability to tailor auto insurance rates to a never-before-seen accuracy that even telematics hasn’t touched. While the debate is still there that people will always go to independent agents for personalized service, the idea of a giant competitor closing its doors has to be comforting to say the least.
Contact GWB Insurance today at (401) 726-3330 and let us do the comparing for you. We work with over 20 financially stable companies to put together competitive insurance proposals catered to you or your business. Buy Local!
ICE Dam Busters Stopping ice dams is simple, in principle: Just keep the entire roof the same temperature as the eaves. You do that by increasing ventilation, adding insulation, and sealing off every possible air leak that might warm the underside of the roof. By taking care of these trouble spots, listed here in order of priority, you should enjoy a winter free of dams and use less energy to boot.
1. Ventilate Eaves And Ridge A ridge vent paired with continuous soffit vents circulates cold air under the entire roof. Both ridge and soffit vents should have the same size openings and provide at least 1 square foot of opening for every 300 square feet of attic floor. Place baffles at the eaves to maintain a clear path for the airflow from the soffit vents.
2. Cap the Hatch An unsealed attic hatch or whole-house fan is a massive opening for heat to escape. Cover them with weatherstripped caps made from foil-faced foam board held together with aluminum tape.
3. Exhaust to the Outside Make sure that the ducts connected to the kitchen, bathroom, and dryer vents all lead outdoors through either the roof or walls, but never through the soffit.
4. Add Insulation More insulation on the attic floor keeps the heat where it belongs. To find how much insulation your attic needs, check with your local building department.
5. Install Sealed Can Lights Old-style recessed lights give off great plumes of heat and can’t be insulated without creating a fire hazard. Replace them with sealed “IC” fixtures, which can be covered with insulation.
6. Flash Around Chimneys Bridge the gap between chimney and house framing with L-shaped steel flashing held in place with unbroken beads of a fire-stop sealant. Using canned spray foam or insulation isn’t fire safe.
7. Seal and Insulate Ducts Spread fiber-reinforced mastic on the joints of HVAC ducts and exhaust ducts. Cover them entirely with R-5 or R-6 foil-faced fiberglass.
8. Caulk Penetrations Seal around electrical cables and vent pipes with a fire-stop sealant. Also, look for any spots where light shines up from below or the insulation is stained black by the dirt from passing air.
The Lexus Champions for Charity Golf Tournament was held on December 9th thru December 13th at Pebble Beach Golf Links in Monterey, California. Over 450 golfers from all around the United States participated to raise donations for their local non-profit charity. James Sequeira along with his son Dr. Scott Sequeira attended to help support the Pawtucket Boys and Girls Club.
The kitchen is the heart of the home, especially at Thanksgiving. Kids love to be involved in holiday preparations. Safety in the kitchen is important, especially on Thanksgiving Day when there is a lot of activity and people at home.
Thanksgiving by the numbers
- In 2013, Thanksgiving Day (November 28) was the leading date for home cooking fires with 1,550, 230% above the average number of fires per day.
- Thanksgiving is the peak day for home cooking fires, followed by Christmas Day and Christmas Eve.
- Unattended cooking was by far the leading contributing factor in cooking fires and fire deaths.
- Cooking equipment is the leading cause of home structure fires and associated civilian injuries and was the third leading cause of home fire deaths.
- Stay in the kitchen when you are cooking on the stovetop so you can keep an eye on the food.
- Stay in the home when cooking your turkey and check on it frequently.
- Keep children away from the stove. The stove will be hot and kids should stay 3 feet away.
- Make sure kids stay away from hot food and liquids. The steam or splash from vegetables, gravy or coffee could cause serious burns.
- Keep the floor clear so you don’t trip over kids, toys, pocketbooks or bags.
- Keep knives out of the reach of children.
- Be sure electric cords from an electric knife, coffee maker, plate warmer or mixer are not dangling off the counter within easy reach of a child.
- Keep matches and utility lighters out of the reach of children — up high in a locked cabinet.
- Never leave children alone in room with a lit candle.
- Make sure your smoke alarms are working. Test them by pushing the test button.
Swords, knives, and other costume accessories should be short, soft, and flexible.
Avoid trick-or-treating alone. Walk in groups or with a trusted adult.
Fasten reflective tape to costumes and bags to help drivers see you.
Examine all treats for choking hazards and tampering before eating them. Limit the amount of treats you eat.
Hold a flashlight while trick-or-treating to help you see and others see you. WALK and don’t run from house to house.
Always test make-up in a small area first. Remove it before bedtime to prevent possible skin and eye irritation.
Look both ways before crossing the street. Use crosswalks wherever possible.
Only walk on sidewalks whenever possible, or on the far edge of the road facing traffic to stay safe.
Wear well-fitting masks, costumes, and shoes to avoid blocked vision, trips, and falls.
Eat only factory-wrapped treats. Avoid eating homemade treats made by strangers.
Enter homes only if you’re with a trusted adult. Only visit well-lit houses. Never accept rides from strangers.
Never walk near lit candles or luminaries. Be sure to wear flame-resistant costumes.
Expecting trick-or-treaters or party guests?
Follow these tips to help make the festivities fun and safe for everyone:
- Provide healthier treats for trick-or-treaters such as low-calorie treats and drinks. For guests, offer a variety of fruits and vegetables.
- Use party games and trick-or-treat time as an opportunity for kids to get their daily dose of 60 minutes of physical activity.
- Be sure walking areas and stairs are well-lit and free of obstacles that could cause someone to fall.
- Keep candle-lit jack o’lanterns and luminaries away from doorsteps, walkways, landings, and curtains. Place them on sturdy tables, keep them out of the reach of pets and small children, and never leave them unattended.
- Remind drivers to watch out for trick-or-treaters and to drive safely.