New backing enables the MGA to cover sums insured up to £20m and expand into Europe

MGA Moonrock Drone Insurance has secured new capacity providers in order to broaden its product set to insure non-standard drone operations and meet “astronomical growth levels” in demand for drone insurance.

Previously, the MGA was solely backed by insurer Hiscox to cover recreational drone flights, small commercial operators and large drone fleets in industries such as film, TV, agriculture and construction - typically with sums insured between £1,000 and £100,000.

However, since starting to write business with the support of its new capacity providers this month (February 2023) – which includes backing from specialist (re)insurer Apollo – Moonrock Drone Insurance has been able to extend its reach to cover non-standard operations with sums insured up to £20m.

This includes risks such as heavy lift drones - that can carry cargo from ships, for example - swarm displays and crop spraying, as well as beyond visual line of sight flights.

Speaking exclusively to Insurance Times, Simon Ritterband, managing director of Moonrock Drone Insurance, said the MGA’s new capacity - which is provided by Apollo as a facility - is “pretty much an open book” that will work hand in hand with data led pricing to insure “a whole new level of risk” that is currently outside of Hiscox’s risk appetite.

Ritterband believes the aviation market’s interest in drone insurance has been piqued, presenting a key opportunity for Moonrock Drone Insurance to work more closely with aviation underwriters - especially as drone use cases expand and potentially replace traditional helicopters and planes.

He said: “Drones are revolutionising every part of society – [there are] the most incredible applications of things now for drones.

“Aviation underwriters see [drones] as the future. This is the future for aviation. We are really excited about the way that the old world aviation industry is now taking on board drones [and] saying ‘yep, this is the future’. The growth of it is astronomical.”

Martin Jackson, head of aviation at Apollo, added: “The drone industry is an exciting area of innovation that can drive positive change in the UK economy, as well as offering environmental benefits, and is a keen area of focus for the UK government.

“We have been working intensively with Moonrock Drone Insurance to create an insurance product that specifically caters for the growth of commercial drones and we are pleased to be leading the way in underwriting this and other new risks in emerging industries.”

Using data to ‘demystify’ pricing

A big part of Ritterband’s work with the aviation insurance market so far has been around supplying data and working on a suitable pricing algorithm for drone risks.

“It’s very difficult to give a one-price-fits-all for things like passenger drones and heavy lifting drones,” he explained.

“I’m trying to demystify the insurance and say ‘right, this is how we’re going to cost your premium and it’s going to be based on these factors’ – [for example], levels of training, levels of redundancy features, levels of safety we can see, a whole checklist.

“We’re the first to do that.”

Ritterband described Moonrock Drone Insurance’s data-based pricing – which checks factors like drone safety features, weather, pilot qualifications, value of the drone and the number of hours flown – as “a breath of fresh air” and “more transparent”.

Certain customers are also able to share their flight logs with the MGA, so that cover can be priced based on current drone activity – Ritterband noted that this has a risk management lens too, as Moonrock Drone Insurance can then advise its clients on the riskier times of days or locations for drone flights, for example. Avoiding these could, therefore, result in cheaper premiums.

New year plans

Now that Moonrock Drone Insurance has its new capacity in place, Ritterband has numerous ambitions for 2023.

This includes expanding the MGA’s reach into new territories, such as Europe and the US.

In terms of setting up shop in the US, Ritterband believes this will require another new capacity provider to come on board, although he hopes to achieve this by the middle of 2023.

Other tasks on Ritterband’s 2023 hit list include constructing more drone specific cyber insurance wordings, as well as becoming a “one-stop-shop” for brokers.

This would include working with broker networks and larger brokers to provide training manuals and webinars on drone insurance, which would work alongside the MGA’s existing broker portal.

“Up until now, there’s not been that one stop solution for brokers - we will have that for them at the beginning of the year,” Ritterband said.