SACRAMENTO, CA, June 30, 2016 -- Despite IIABCal's opposition, Assemblyman Mike Gatto’s Drone Registration/Omnibus Negligence-prevention Enactment (DRONE) of 2016, passed the Senate Judiciary Committee this week by a 5 to 2 vote.

“IIABCal is opposed to AB 2724, specifically the insurance mandate.   “While the evolution of drone technology represents exciting opportunities for both businesses and hobbyist, like any innovation, these devices also offer new and unknown risk based on how they are used,” IIABCal Lobbyist Erin Norwood said.  “Insurance will undoubtedly be one part of managing these risks and, carriers have already begun to explore how to best underwrite drones-related risk to protect the public and policyholders.

“However, the insurance industry believes that statutorily requiring insurance for drone usage is unwise as there is currently insufficient actuarial data to effectively calculate risk,” Norwood said. “Insurers must be permitted to develop the knowledge, experience, products, and pricing to insure drone activities—and without the ability to accurately underwrite, the cost of drone insurance products will be unnaturally high, deterring use and access to this  developing technology.”

The DRONE Act would:

Mandate that drones of a certain size, and equipped with GPS capability, feature automatic shut-off technology that would activate if approaching airports and other sensitive infrastructure or fires.  This technology already exists, and is critical to protecting commercial passenger flights.

• Beginning in 2020, require drone insurance to ensure that, if a drone hurts someone or damages property, the victim can be compensated.  This requirement is akin to the auto-insurance requirements under current law.
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• Require all drone packaging to include safety disclosures and FAA registration rules.
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“The DRONE Act will protect our passenger jets in California’s busy aerospace.  It further ensures that negligent drone operators be held financially responsible, whenever injuries, interference, or property damage occurs,” asserts Assemblyman Gatto.  “This is a practical measure that will increase public safety without harming the growth of the industry.” 

Recognizing IIABCal’s  concerns, the author agreed to a series of amendments in the Senate Transportation and Housing Committee last week that would delay the enactment of this bill's protection against liability provision until 2020, and that would enlist the Department of Transportation to set liability protection amounts  adequate to cover anticipated losses and claims associated with recreational drone use. 

While IIABCal appreciates the author’s willingness to delay the insurance mandate, it is still a mandate, therefore we remains opposed to AB 2724,” Norwood said. 

The legislation now heads to the Senate.