Insurers Take to the Skies
This year’s hurricane
season sees the use
of drones and other
as insurers seek to
estimate claims costs.
By Antony Ireland
Drone view above La Grange, Texas, a small town devastated by powerful Hurricane Harvey.
For Southern communities, current recovery efforts in the wake of Hurricane Harvey will recall the painful devastation of 2005, when Katrina and Wilma struck. But those who look skyward will notice one conspicuous difference this time around: drones. Much has changed since Katrina and Wilma, both economically and
technologically. The insurance industry evolved as well. Drones and other visual
intelligence systems (VIS) are set to play an increasing role in loss assessment,
claims handling and underwriting.
Farmers Insurance, which announced in August it launched a fleet of drones
to enhance weather-related property damage claim assessment, confirmed it
deployed its fleet in the aftermath of Harvey.
“The pent-up demand for drones, particularly from a claims-processing
standpoint, has been accumulating for almost two years now,” said George
Mathew, CEO of Kespry, Farmers’ drone and aerial intelligence platform provider
“The current wind and hail damage season that we are entering is when
many of the insurance carriers are switching from proof of concept work to full
According to Mathew, Farmers’ fleet focused on wind damage in and around
Corpus Christi, Texas, at the time of this writing. “Additional work is already
underway in the greater Houston area and will expand in the coming weeks and
months,” he added.
No doubt other carriers have fleets in the air. AIG, for example, occupied the
forefront of VIS since winning its drone operation license in 2015. It deployed
drones to inspections sites in the U.S. and abroad, including stadiums, hotels,
office buildings, private homes, construction sites and energy plants.
At present, insurers are primarily using VIS for CAT loss assessment. After
a catastrophe, access is often prohibited or impossible. Drones allow access for
assessing damage over potentially vast areas in a more cost-effective and time-sensitive manner than sending human inspectors with clipboards and cameras.
“Drones improve risk analysis by providing a more efficient alternative to
capturing aerial photos from a sky-view. They allow insurers to rapidly assess
the scope of damages and provide access that may not otherwise be available,”
explained Chris Luck, national practice leader of Advocacy at JLT Specialty USA.
“In our experience, competitive advantage is gained mostly by claims
departments and third-party administrators. Having the capability to provide
exact measurements and details from photos taken by drones allows insurers to
expedite the claim processing time,” he added.
Indeed, as tech becomes more disruptive, insurers will increasingly seek to take
advantage of VIS technologies to help them provide faster, more accurate and
more efficient insurance solutions.
One way Farmers is differentiating its drone program is by employing
its own FAA-licensed drone operators, who are also Farmers-trained claim
Keith Daly, E.V.P. and chief claims
officer for Farmers Insurance, said
when launching the program that this
sets Farmers apart from most carriers,
who typically engage third-party drone
pilots to conduct evaluations.
“In the end, it’s all about the
experience for the policyholder who
has their claim adjudicated in the most
expeditious manner possible,” said
“The technology should simply
“Having the capability to
provide exact measurements
and details from photos taken
by drones allows insurers to
expedite the claim processing
— Chris Luck, national practice leader of
Advocacy, JLT Specialty USA
• Drones will play an increasing
role in loss assessment.
• Insurers will benefit from
increased access and the
availability of rapid assessment
• Better data leads to pricing