Drone Insurance and Part 107: The FAA Requires None

A client sends over a contract and it asks for a million dollars of liability cover and a certificate of insurance naming them as additional insured. You go looking for the FAA rule that sets the number, because presumably there is one.

There is not. There is no rule at all.

So the FAA will certificate you, register your aircraft for $5, and let you fly commercially over other people's property without ever asking whether you could pay for anything you break.

What the FAA does require, for contrast

The obligations that actually exist under Part 107 are about competence and conduct, not money:

• A remote pilot certificate with a small UAS rating (§ 107.12), and aircraft registration (§ 107.13).
• § 107.19 — the remote pilot in command is directly responsible for and is the final authority as to the operation, and must ensure the operation poses no undue hazard to other people, aircraft or property.
• § 107.23 — no hazardous operation, meaning nothing careless or reckless that endangers life or property.
• § 107.9 — a report to the FAA within ten calendar days after a serious injury or property damage above $500.

Read those together and the gap is obvious. The regulation assigns you personal, final responsibility for the safety of the flight, and then says nothing whatsoever about your capacity to answer for it financially. Responsibility without required backing is the entire argument for carrying cover voluntarily.

The $500 in § 107.9 is not a liability threshold

This confusion is common enough to be worth stating flatly. The $500 figure in the safety event reporting rule decides whether you must tell the FAA. It has no bearing whatsoever on what you owe the person whose property you damaged.

Break a $400 window and you owe the owner $400 while owing the FAA no report. Break a $40,000 vehicle and you owe a report and, potentially, $40,000. The reporting threshold is an administrative trigger, not a cap, a deductible, or a shield.

So who actually imposes insurance requirements?

Everyone except the agency that certificated you. In practice the requirement arrives from one of these directions, and it arrives as a contract term rather than a regulation:

Source	Typical shape
Clients	A stated liability limit and a certificate of insurance, often naming the client as additional insured. Common in construction, real estate and utility work.
Property owners and venues	Site access conditional on cover. Stadiums, industrial sites and managed estates frequently ask.
Employers	If you fly as an employee, the cover is usually the employer's — which is not the same as it covering you for work done on the side.
Lenders and lessors	Financed or leased equipment normally has to be insured as a condition of the agreement.
State or local law	Varies, and is outside anything the FAA governs. See the caveats below.

The practical consequence is that the question is rarely "am I required to have insurance." It is "what does this job require, and can I produce evidence of it before Friday." Certificates of insurance take time to issue. Discovering the requirement on the day of the shoot is how jobs get lost.

The two things people conflate

Broadly, drone cover splits into two ideas that solve different problems:

• Liability — damage you cause to other people or their property. This is what client contracts are asking about, essentially always.
• Hull — damage to your own aircraft. This is what feels urgent after you have destroyed a drone, and it is the one no contract cares about.

Note that these map onto the same distinction § 107.9 draws: your own aircraft sits on one side of the line, everyone else's property on the other. The regulation and the insurance market are both organised around the fact that those are different kinds of loss.

Flying without it

Legal under Part 107, and a decision rather than an oversight — which is the useful way to frame it. If you fly uninsured, you are self-insuring: personally absorbing whatever a bad day costs. For a sub-250-gram aircraft over your own land, that is a rational position. For a heavier machine over a client's roof, over a car park, or anywhere near people, the number you could be asked for is not bounded by the value of your equipment.

The risk-reduction that costs nothing is worth doing regardless: fly inside the categories rather than seeking permission to leave them, get the airspace authorisation before you launch rather than after, and know which limitations can even be waived before you promise a client something the rules do not allow.

What we could not confirm

• We are not insurance advisers and this is not advice. Nothing here recommends a policy, a limit or a provider, and we have no view on what you personally should buy.
• We could not confirm whether any US state or municipality mandates drone insurance. State and local law is outside the FAA's rules and outside what we verified; if it matters to you, ask a broker or an attorney licensed where you operate.
• We could not confirm typical premiums, limits or what counts as "commercial use" to any given insurer. Those are underwriting questions and they vary by carrier.
• We could not confirm whether homeowner's or general business policies exclude drone operations. Many reportedly do. Read your own policy or ask the carrier in writing rather than trusting a general statement, including this one.
• The finding that Part 107 contains no insurance requirement is current as of the eCFR edition we checked — Title 14 up to date as of 11 August 2026, last amended 31 July 2026. Rules change; the absence of a requirement today is not a guarantee about next year.

The short version

The FAA requires no insurance. Not a minimum limit, not proof of cover, not a mention of the subject anywhere in Part 107 or on its drone pages. Every insurance requirement you will ever meet comes from a client, a venue, an employer, a lender or state law — never from the agency that gave you the certificate. Meanwhile § 107.19 makes you personally and finally responsible for the operation, which is precisely why the absence of a requirement is not reassurance. And the $500 in the reporting rule decides whether the FAA hears about it, not what you owe. Those are different questions with different answers, and confusing them is expensive.

The regulations that do bind you — operating limitations, pilot responsibility, reporting duties — are all examinable and all worth knowing cold. Start free with the Flycensed iOS app and its 485+ practice questions, or work through the regulations chapters in the Part 107 Complete Study Guide ($14.99).