Payload & Camera Coverage: How to Insure Expensive Sensors and SSDs

Quick TL;DR

• Cameras, LiDAR, multispectral sensors, gimbals, and SSDs are often excluded from standard hull coverage unless explicitly scheduled or covered by an agreed-value clause.

• Agreed-value pays the pre-agreed amount for a total loss. Actual cash value pays depreciated value. For expensive sensors, agreed-value is usually worth the extra cost.

• Protect the data on SSDs with separate cyber or data liability cover and secure handling procedures. A damaged SSD can be cheaper to replace than the liability and breach costs that follow a lost data exposure.

Payload & Camera Coverage: How to Insure Expensive Sensors and SSDs

Executive summary

If you run commercial drone operations and your camera, LiDAR unit, or SSD costs more than a few thousand dollars, you cannot treat payload insurance as optional. 

Many claims fail or underpay because sensors are detachable and not scheduled, because carriers treat payloads differently, or because data loss triggers liabilities not covered by hull insurance. 

This article explains how payloads are insured, the practical difference between agreed-value and actual cash value, what to schedule and how, how to insure data on SSDs, and the exact language and paperwork to insist on when you bind coverage.

Why payloads behave differently from airframes

Insurers view an airframe and its payload as separate risk items for several reasons:

• Payloads are frequently removed between jobs and carried separately. Theft, transit loss, and handling damage are therefore common.

• Payload technology depreciates quickly. Camera models change fast and insurers do not want to pay retail replacement for old equipment unless agreed upfront.

• The value of a payload can exceed the airframe. LiDAR rigs and cinema cameras can be 5 to 10 times the value of the drone itself.

Because of this, carriers often exclude detachable payloads from basic hull cover or impose sublimits unless the items are scheduled or insured under an agreed-value clause.

Agreed value vs actual cash value - the short math you need

Actual cash value (ACV)

• ACV pays replacement cost minus depreciation.

• Example: camera bought 24 months ago for $12,000 with 20 percent annual depreciation. ACV payout on total loss would be roughly $12,000 minus $4,800 = $7,200, minus deductible.

Agreed value

• You and the insurer agree the value at binding, and that is what gets paid for a total loss, subject to policy terms and deductibles. No depreciation fights.

• Example: camera agreed-value set at $12,000. Total loss payout is $12,000 minus deductible.

Which to choose? For any payload worth more than you can tolerate replacing at ACV, buy agreed value. For cheap consumer cameras, ACV may be acceptable.

Practical ways to insure payloads and SSDs

1) Schedule payloads on the hull policy

• Provide serial numbers, purchase invoices, and agreed-value declarations if needed.

• Scheduling ensures the insurer knows the item exists and can price the exposure. Many claims fail because the payload serial number is not listed anywhere.

2) Buy agreed-value endorsements for high-value sensors

• Agreed value costs more but eliminates depreciation risk. For a $25,000 LiDAR unit it is almost always cheaper long-term to pick agreed value.

3) Use separate inland marine or equipment floater policies

• These policies are written for movable equipment and can cover transit, theft, and handling damage that hull policies may exclude. Good for payloads that are frequently moved between vehicles and job sites.

4) Short-term payload riders for rentals

• If you rent high-end cameras occasionally, buy a one-day payload rider that schedules the serial number and agreed value for the rental window.

5) Non-owned or borrowed equipment coverage

• If you operate rented or borrowed payloads regularly, buy non-owned equipment coverage to protect you while operating gear you do not own.

6) SSDs and data coverage

• Physical SSD damage is part of payload risk and should be scheduled if it is expensive.

• Data loss or data breach is a separate risk. Standard hull and liability often exclude cyber or data breach costs. Get a cyber/data liability endorsement or small business cyber policy if you store client imagery, personally identifiable information, or sensitive site data. This pays for notification, forensic, and legal costs after a breach.

Read: Insurance for Drone Rental Platforms & Peer-to-Peer Lenders

Common claim scenarios and how to avoid underpayment

Scenario A - Camera destroyed in crash, not scheduled

• Outcome: Carrier treats camera as unscheduled and either denies payout for the camera or pays ACV after small depreciation. Result: operator pays difference or fights insurer.

Fix: Always schedule cameras and list serials on the policy. Use agreed value for high-cost cameras.

Scenario B - LiDAR stolen from vehicle between jobs

• Outcome: Hull may not cover theft during transit unless "in transit" and theft are explicitly included. Carrier denies theft claim on basis of exclusion.

Fix: Use an inland marine floater or ensure hull includes theft in transit. Lock and document custody chain.

Scenario C - SSD lost with client data

• Outcome: Hull may pay to replace SSD but not the customer breach notification, legal, or reputational costs.

Fix: Buy cyber/data liability; encrypt SSDs and use secure transfer protocols and retention policies to reduce breach risk.

Exact payload schedule format you can copy for brokers

When you request an endorsement, use this exact tabular format. Paste into the broker email or binder form.

Payload schedule sample

• Item type: Camera / LiDAR / Gimbal / SSD

• Make and model: [e.g., Sony A7R IV]

• Serial number: [SN123456]

• Purchase date: [mm/dd/yyyy]

• Purchase price: [$12,000]

• Agreed value: [$12,000] or ACV (state ACV if chosen)

• Primary location: [City, State / In transit]

• Notes: [Rented, owner, or platform name if non-owned]

Providing exact serials and invoices reduces friction and speeds claims.

Pricing examples and decision rules (illustrative)

• Small camera under $2,000: schedule optional, ACV usually fine.

• Camera $2,000 to $7,000: schedule and consider agreed-value if you need full replacement cash.

• Camera or LiDAR over $7,000: agreed-value strongly recommended. Insurer will charge more but avoids depreciation disputes.

Budget rule of thumb: if ACV payout would be more than 20 percent less than replacement cost and that gap matters to your business continuity, buy agreed value.

SSD and data handling - operational rules you must follow

Data is an asset and a liability. Policies and underwriters look for good handling practices.

Operational rules

• Always encrypt SSDs and use hardware encryption when possible.

• Maintain a written data retention and deletion policy. Limit holding sensitive images unless required by contract.

• Use secure transfer protocols and authenticated cloud upload with logging.

• Log custody chain: who had the SSD and when. Keep signed handoff sheets for rental or crew swaps.

• Keep at least one verified backup of mission-critical data offsite where allowed by your client contract and privacy obligations.

If you lose an SSD and cannot prove the custody chain or encryption, cyber carriers will reduce recovery or deny some costs.

Policy clause example you can request from brokers (copy-paste)

"Payload coverage shall include all scheduled detachable equipment listed on the schedule page, including cameras, sensors, and storage devices. For scheduled items listed as agreed-value, the insurer will pay the agreed-value amount on total loss less any applicable deductible. 

Theft in transit is covered when the insured equipment is under the direct control of the insured or while secured in a locked vehicle overnight, subject to a deductible of $[amount]. Data loss or breach is excluded unless a cyber/data liability endorsement is purchased."

Get the broker to place this language or equivalent in your binder.

Quick checklist before you bind payload coverage

• List every payload serial number and upload invoices.

• Decide agreed value or ACV for each payload and record the reason.

• Add inland marine or theft-in-transit coverage if you move payloads frequently.

• Add non-owned coverage if you rent frequently.

• Buy cyber/data liability if you store client imagery or PII.

• Document SSD encryption and custody procedures.

• Keep copies of purchase invoices on file and in the policy packet.

Bottom line

If your business depends on expensive sensors, do not guess at coverage. Schedule everything, use agreed-value where replacement matters, protect data separately, and demand clear policy language about theft in transit. 

The extra premium you pay for agreed-value and inland marine protection is insurance, not an avoidable cost. It is what keeps you flying after a loss.

Read: How FAA Violations Impact Insurance Claims & Premiums

Author

Svetlana - I am a Drone Insurance Writer and Researcher. I write about drone risk management and insurance for US pilots. Not a licensed broker. For policy advices contact a licensed insurance professional.