The widening use of drones among companies and hobbyists has given rise to numerous new startups hoping to capitalize on the opportunity. Among them is London-based Flock Ltd., which is going after a side of this market that is, surprisingly, already quite crowded: drone insurance.

The startup today announced that it has raised £2.25 million (about $3 million) in seed financing to pursue its plans. The investment was led by Anthemis Group, a venture fund focused on the financial and insurance technology segments.

Flock has built an insurance platform that lets drone operators take out policies before a flight for periods as short as one hour. According to the startup, premiums are priced based on the perceived risk involved in each individual aerial trip. Flock calculates that risk using an approach developed by its founders, Ed Leon Klinger and Antton Peña, during their time in the academia.

The startup’s algorithms correlate real-time data such as the weather conditions along a flight path with static details, including the physical characteristics of a drone. Flock then turns the results into a risk score that is used to create a personalized premium for operators. The startup’s policies are underwritten by German insurance giant Allianz SE.

Flock claims that its risk-based pricing approach offers drone operators a more flexible alternative to the traditional insurance options available in this segment. Moreover, the startup makes some of the data collected in the assessment process directly available to customers in order to help them plan safer flight routes.

Flock claims a client base of more than 1,000 commercial drone operators. The startup said it’s currently working with insurers to determine if the platform’s technology could be applied to other industries as well. In the shorter term, it will use the new seed funding to expand internationally and hire more technical personnel.

There are several other emerging players eyeing the same opportunity as Flock. Just last month, a startup called SkyWatch Insurance Services Inc. launched a flight planning platform that doubles as an insurance service.

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