Post-catastrophe imagery and AI-derived property damage and condition data unite to help insurers process customer claims more efficiently.
According to McKinsey & Company1, recent spikes in inflation are a rising threat to property & casualty (P&C) insurers nationwide. Estimates show that rising prices contributed to an approximately $30 billion increase in loss costs in 2021 and that number seems poised to increase in 2023 as inflation continues to soar. As disaster season approaches, P&C insurers must evaluate their current book of business and ensure that they have the proper systems in place to not only prevent premium leakage but to fulfill their promise to policies in force (PIF) in a catastrophic event.
While studies show that these increases are a more recent phenomena, they don’t seem to be decreasing any time soon. Climate change is creating more intense, significant damage and often sets off cascading hazards, like prolonged drought followed by devastating wildfires—often leading to dangerous flooding and mudslides. In 2022 alone, the U.S. experienced 18 separate weather and climate disasters costing insurers over $1 billion, with the single most costly disaster being Hurricane Ian.1
It’s imperative that P&C insurers prepare to help policyholders recover from catastrophic events while also surviving rising loss costs and inflation. The number one tool to support both of these tasks is information. P&C insurers need the best, clearest, and most up-to-date information in order to help themselves and their policyholders weather literal storms and economic crises.
Aerial imagery solutions, from a source like Nearmap, provides a robust foundational location dataset that can power virtual claims management and loss adjustment across an insurer’s entire book of business today and into the future. Think of aerial imagery as the gas that powers engine room of your property intelligence capability.
After a disaster, it’s tough for insurers to respond to thousands of urgent claims, assess their liability, and ensure loss reserves are properly funded. This process is further delayed when companies have to wait to send out adjusters and assess each individual property on the ground. Companies need to leverage intelligence and assess the extent of damage within days to properly address the volume of claims during and immediately following a catastrophe. Data companies are giving insurers the ability to quickly scan the area of impact across an entire region and understand which of their policies has been affected, without waiting to send loss adjusters to inspect in person.
Unfortunately, the fundamental drawback with many of these aerial imaging and intelligence programs is they often fail in one of the big three categories: speed, quality, and ease of access. This makes it challenging for insurers to trust the ground intelligence they are getting is accurate and will lead to confident claims decisions.
In tandem with that challenge, insurers should also consider whether their aerial intelligence provider has tools that can enhance the insurer's ability to understand visual data. Especially helpful tools to look for would be an integrated AI that could highlight different qualities about a property, the surrounding area, and highlight risks associated with frequent disasters in that area. Because AI development and layering can take time, consider how long it takes a data provider to integrate their offered tools onto new imagery, especially with speed and quality after a catastrophic event.
Tornado Damage
Mar 25, 2023 | Rolling Fork, MS
Not only is aerial imagery essential during and immediately after a disaster, imagery can revolutionize how companies build policies for prospective clients. Aerial imagery and intelligence companies do insurers a great service by providing insight into truth on the ground, but most do not update their image databases frequently enough to give insurers truly up-to-date information. When it comes to the claims process, good information is key to healthy decisions. While most see insurance as a reactive industry, being proactive is what really sets insurers apart and helps prepare the company—and policyholders—in a catastrophic event. Professionals at Florida-based Kin Insurance say, "It helps drive our risk selection outside of just our direct class processes and is a really valuable tool for underwriters.”
All in all, when deciding on an aerial imagery and data provider, it’s important to look for consistency. How frequently does the provider update its database? Do they provide truth on the ground for the same areas regularly? If so, do they also provide new imagery if/when a disaster occurs? Historical data is important to P&C companies because it allows adjusters to digitally assess damage, which speeds up the claims process and creates happier policyholders.
It’s also important to remember that disaster season is not a one time event; it comes around every single year. Insurers need to prepare and learn from the mistakes or issues they encountered the previous season. If you have an aerial imagery provider, were they able to get you clear imagery quickly after a disaster? If not, how much time and how many resources did your company spend sending adjusters out to assess damage in person? How quickly were you able to fulfill your promises to policyholders who experienced damages? Did you lose any of your business because you weren’t able to respond quickly enough? Consistent imagery allows insurers to fully understand an area and its properties before a disaster, so you can react more quickly and confidently.
Ultimately, it is most imperative for insurance companies to prove their commitment to their customers after a catastrophe. It tests their ability to deliver on their promise to their policyholders that they will make their customer whole in the event of loss, damage, or theft. Especially in today’s market, challengers like Lemonade and Hippo can respond to customer claims instantaneously. Because of this, shortening the response time after an influx of claims is extremely important to retain customers.
Aerial data can be indispensable in this regard because insurers need to instantly visualize and understand current property conditions without waiting for a physical inspection. In some cases this means they can start the payout without delay—as was the case for Kin Insurance after Hurricane Ian—or find temporary housing if the policyholder’s home has become uninhabitable. Using aerial imagery can even position companies to proactively reach out to property owners before a claim is filed to alert them to the property damage and get the claim started.
It’s a tough time to be in the insurance industry. Ongoing concerns from climate change and the recurring nature of disaster season, average annual losses are set to increase while customer satisfaction with “business as usual” decreases. That’s why many insurers are turning to aerial data and intelligence companies, like Nearmap, to keep themselves viable in today’s market.
A leader in aerial imaging, Nearmap regularly captures current, high-resolution imagery and property insights across more than 108 million residential and commercial parcels in the U.S. and Canada, giving the North American insurance ecosystem unprecedented access to the visual source of truth to make critical decisions across the entire policy lifecycle. From mitigating risk and calibrating price, to supporting underwriting and renewals, to speedy investigation and processing of claims with both pre- and post-catastrophe data. With a rich location content stack, including 2D, 3D, and AI datasets, you have actionable property insights to calibrate risk while serving customers with the care and responsiveness they expect.
With Nearmap ImpactResponse, insurers have the property insights and damage assessment tools needed to reduce risk before a catastrophe and provide faster support to policyholders after a major weather event. Covering wildfires, tornados, extreme wind events, and hurricanes, Nearmap ImpactResponse provides a reliable view of what’s happening on the ground in near real-time, allowing you to quickly assess damage and triage your response.
Post-catastrophe imagery shows you what’s there today—while our regularly refreshed surveys give you the full story. Nearmap captures fresh imagery up to three times annually across the United States, covering over 80% of the population across more than 308,000 mi2.
Combined with pre-catastrophe captures of areas prone to severe weather, our historical imagery provides a contextual snapshot of conditions prior to an event—allowing informed decisions to better dictate your response.
While we make every effort to ensure the accuracy of the data and analysis in blog articles, this information is not to be relied on as professional advice. No endorsement or approval of any third parties or their advice, opinions, information, products or services is expressed or implied by any information in the blog. Should you seek to rely in any way whatsoever upon this content, you do so at your own risk.
