The Hong Kong insurance regulator is encouraging the insurance sector to play a more proactive role in the development of the city’s emerging low-altitude economy. The rapid adoption of drones and other small unmanned aerial vehicles (UAVs) has created new risks, prompting growing demand for tailored insurance solutions. In response, the Hong Kong Insurance Authority (HKIA) is working closely with insurers to ensure a secure and stable environment for businesses, institutions, and the public.
Since 13 February, HKIA has been assisting stakeholders involved in low-altitude operations to identify suitable insurance products. Regulations stipulate that operators of small UAVs must maintain third-party liability coverage, which applies in cases of bodily injury or death. The minimum coverage amount varies according to aircraft weight and risk level, ranging from USD 1.3 million (HK$10 million) to USD 2.6 million (HK$20 million).
Currently, more than 13 insurers in Hong Kong offer such products. HKIA has advised these firms to enhance product design and service quality to foster greater safety awareness among operators and users. This includes incorporating risk assessment and individual underwriting considerations, such as flights beyond visual line of sight or over densely populated areas. Premium calculations may also factor in pilot training, maintenance records, and flight data management.
The Authority further highlighted that insights from the government’s “Low-Altitude Economy Regulatory Sandbox” and the advanced “Regulatory Sandbox X” will enable insurers to analyse operational scenarios, thereby improving underwriting accuracy, premium setting, and product competitiveness. A task force from the Hong Kong Federation of Insurers is utilising sandbox data to monitor complex risk environments, post-incident claims, and cross-border exposures associated with operations outside Hong Kong.
HKIA has warned that as the low-altitude economy expands to include large UAVs, drone-based logistics, emergency services, medical supply transport, and eventually passenger transport, risk profiles will become increasingly complex. The Authority urges insurers to actively contribute to the sector’s long-term growth through product innovation, cross-border collaboration, and workforce development.
Third-Party Insurance for Small UAVs
| Aircraft Weight & Risk Level | Minimum Insurance (USD) | Minimum Insurance (HK$) |
|---|---|---|
| Low risk / Light aircraft | 1,300,000 | 10,000,000 |
| Higher risk / Heavy aircraft | 2,600,000 | 20,000,000 |
Through this initiative, Hong Kong positions the insurance sector as a key driver in ensuring the safe, sustainable, and resilient development of its low-altitude economy.