UAS can range in size from micro surveillance vehicles that can fit in the palm of the hand to the RQ-4 Global Hawk, a 7.5 ton jet-engine powered aircraft capable of flying 30+ hours non-stop. This article will refer to these vehicles (singular or plural) as UAS.
UAS technology was rooted first in military development, remote tracking and reconnaissance applications. The first drones, unmanned balloons loaded with explosives and sent with the prevailing winds toward enemy targets, were in use around 1860.
Civilian UAS applications have grown exponentially in the last few years, especially the small (less than 3 lbs.) units that cost from $500 to $2,000.
So popular have UAS become that the US Federal Aviation Administration (FAA) projects that by the end of 2016 there will be over 600,000 UAS deployed in the US for commercial use, quite a number considering that there are only 204,408 active general aviation (GA) manned vehicles in use. By 2020, there will be 2.7 million commercial UAS – over 10 times the number of manned aircraft in the skies today.
The UAS industry is the most dynamic growth sector of the global aerospace industry. Hard numbers can be difficult to come by but growth projections are significant. The Association for Unmanned Vehicles International (AUVSI), the largest trade group around UAS, estimates that by 2019 more than 70,000 jobs will be created in the US with an economic impact of more than $13.6bn. Meanwhile, a third of UAS manufacturing occurs in Europe. In France the number of approved operators increased by over 400% between December 2012 (86) and February 2014 (431) while Sweden and the UK have issued more than 200 operators’ licenses each in recent years1.
Globally, UAS market volume is expected to reach 4.7 million units by 20202, although other forecasts predict an even higher number. UAS spending is expected to double over the next decade to $11.6bn worldwide, totaling just over $89bn in the next 10 years3. In addition it is estimated that the global market for commercial applications of UAS technology will soar to around $127bn by 2020 compared with $2bn today4. Clearly, the unmanned vehicle market is a burgeoning one, demanding the attention of companies wishing to put them to commercial use, government agencies wanting to regulate them and insurers seeing the need to mitigate their inherent risks with coverage solutions.
Commercial UAS usage continues to increase and evolve: The freight company DHL piloted a test case in Germany to deliver emergency supplies and medicine from the mainland to the island of Juist in the East Frisian Islands. The first successful US pilot program of a “ship to shore” UAS delivery of medical supplies was recently carried out on the New Jersey coastline.
A similar research project has perfected a UAS “parcelcopter” for use in the Bavarian Alps. In Singapore, Airbus Helicopters and the Civil Aviation Authority are working to perfect a package delivery system in urban areas, while Amazon will conduct similar trials in partnership with the government in the UK. In Brazil, UAS are used as monitoring tools to prevent the exploitation of slave labor in agricultural areas, while in Africa there are plans to use them to deliver blood and vaccines to remote areas, potentially saving thousands of lives a year. Even the pizza maker, Dominos, is piloting a pizza delivery scheme in Germany, while convenience store 7-Eleven recently delivered coffee and a chicken sandwich to a family in Reno, Nevada, in the US.
“Use of UAS and UAS technology will cross further boundaries in the years to come,” says Kriesmann. “Perhaps, we may even see their use extended to other forms of driverless vehicles, and even flying cars, as technology develops and converges.”
Shorter term, insurers, such as Allianz, are also utilizing UAS. Both underwriting and claims management can be made quicker and more effective by using such systems to assess risk and survey loss damage. For example, when parts of Tianjin, China were rendered inaccessible after major explosions last year, high resolution images taken by UAS after the blasts were compared with previous photographs to determine how many vehicles had been destroyed. Similarly, in the event of a flood, UAS can provide the insurer with a visual overview, helping it to quickly alleviate damage and distress to victims and property.
1. On average building inspection times are 60 hours for onsite test engineers, as opposed to 3.5 hours for drone inspection (based on research estimate for 20 x 80 m wide façade building,) Source: Fairfleet.
3. RPAS – Frequently Asked Questions, European Commission, April 2014
4. The Independent: “Drones boom puts insurers at risk of multi-billion dollar bill”
5. TechCrunch Disrupt