Following dissatisfaction with the speed of property insurance claims responses following Hurricane Irma and Hurricane Harvey, insurance companies are relying on innovative technology to deal with disasters in 2018. Though some are expressing enthusiasm for this change, others say that using drones, artificial intelligence, and small aircraft to assess damage might lead to claims having to be reopened later if initial repair estimates are too low.
Last year saw an onslaught of disasters including Hurricane Harvey, Hurricane Irma, and several wildfires that left insurance companies scrambling to keep up with their damage assessments. To speed things along, last year the companies used aerial technology, but have now found that they had to reopen repair claims after estimates turned out to be too low.
As a result, the estimated net catastrophe losses from the storms increased by $400 million. According to Dominic Addesso, Chief Executive of Everest Re Group Ltd., a company that offers insurance coverage to other insurers, “Settling claims quickly was initially a sound strategy, but what we now know is that this approach left our clients vulnerable when the actual repair bills came in higher than at what they originally closed their claim.”
Hurricane Irma and Hurricane Harvey Claims Saw New Methods of Insurance Adjustment
During Hurricane Harvey, property owner Stephen Dunn was able to use a motion sensor camera installed on his doorbell to take photos of rising flood waters and send them to his insurer. The process meant that the insurance company declared the vehicles in his garage a total loss and deposited money directly into his bank account quickly. “I had no idea that they would resolve this so quickly,” he said.
Drones and small airplanes have been used to a greater extent in 2018 than they were in 2017, and this is a trend that is expected to continue, with a goal to shortening the average length of time that policyholders get paid. In 2017, victims of Hurricane Irma and Hurricane Harvey experienced an average wait time of 16.5 days to get payments for residential property damage, though in Texas the average time for resolution was 24.5, and in Florida, most of the complaints registered with a Hurricane Irma insurance hotline were about claim delays.