The drone aircraft sector is expanding rapidly within global aviation, with spending expected to double to $US91 billion ($125.49 billion) by 2024, according to a report from Lloyd’s.

The development presents new challenges for insurers, with threats including cyber attacks, reckless pilots and privacy breaches.

Lloyd’s says insurers and drone manufacturers and users must consider concerns around safety, security and surveillance.

“Adequate insurance coverage will likely be of particular importance to protect users against emerging risks. By providing the support needed for the systems to operate safely and with due regard for third-party interests, the insurance industry has the potential to act as an enabler for the successful adoption of this emerging technology.”

Lloyd’s says drone manufacturers must be prepared to manage increasing vulnerability to intellectual property and product liability risks.

Other concerns include inconsistent regulatory regimes across international jurisdictions, poor enforcement by regulators and vulnerability to cyber attack.

“Cyber-security measures will likely be increasingly significant for underwriters’ risk assessment of commercial drone operations,” the report says.

Privacy infringement is probably the most common public concern about drones.

“Professional indemnity insurance can cover the cost of damages awarded for breach of privacy against drone operators,” Lloyd’s says.

Drones are now used for activities including military, agriculture, public services, wildlife protection and research. As their use expands, exposure to third-party liability claims is likely to mount.

“While the market for drone insurance is relatively small at present, the projected expansion of the market, and the diversity of potential applications, means Lloyd’s anticipates significant growth in the need for insurance solutions,” the report says.