It’s a bird! It’s a plane! It’s an unmanned aerial aircraft system recording data in real-time and supporting artificial intelligence to speed up insurance claims, reduce risk to field workers, and save carriers gobs of cash!
That’s right. Drones are joining the vanguard of insurance claims operations. And if you haven’t already invested in drone technology, now’s the time. In fact, drones have been proven to increase inspection efficiency by up to 85%, with the potential to save the insurance industry as a whole $6.8 billion USD per year.
Let me breakdown why 2020 is the year that every insurer should invest in a fleet of drones, and—more importantly—how to integrate a drone strategy with your core systems, business operations, and analytics technologies.
As early as 2015, the FAA began granting insurance carriers permission to use drones for data collection, underwriting, claims resolution, and disaster response. Since then, leading insurers and startups alike have created impressive competitive advantages through their drone programs. Betterview, for example, executed more than 6,000 rooftop inspections between 2016 and 2018. Similarly, Allstate reduced the time it takes to issue a repair estimate after a customer report to as little as 4.5 days.
The key objectives for insurers using drones are 1) more sophisticated risk management through better data collection, and 2) reduced operational costs by way of improved efficiency and effectiveness of claims. Driving these objectives are exciting technologies that drones can be equipped with, like infrared cameras, license-plate readers, laser radar, and sensors that measure weather, temperature, radiation, and a host of other important environmental conditions.
Imagine the possibilities if your company could supplement their data strategy with this influx of rich data—data that’s safer and faster to collect than ever before. For instance, COUNTRY Financial has been able to scout three times as many acres as an adjuster on foot in order to account for a policyholder’s crop damage.
Considering the projected value for drone solutions is $13 billion from commercial business alone, it’s high time every carrier leverages this powerful new arm of data collection, risk mitigation, and efficiency improvements.
One reason that almost 450,000 commercial drones are projected to fill the sky by 2022 is their multitude of business applications. For insurance carriers, drones add value at every stage of the claims process. Data collected before a policy is opened up can help the policy holder reduce their risk profile by identifying either existing features that mitigate risk, or action they can take to reduce their overall risk. That means premium discounts for property owners and happy customers for carriers. Moreover, the U.S. government is already working with insurers to monitor natural disaster threats and alert residents in high-risk regions to imminent danger.
On the other side of the coin, drones make claims faster and more accurate, while reducing the risk of fraud. For inspections, field adjusters can use drones to spot hard or impossible to see conditions with their feet planted firmly on the ground. Consider commercial boiler inspections: these machines are often several stories high and pitch-black inside. Drones remove the need for scaffolding and humans working inside the boiler while transmitting higher-quality photographs and data. Plus drones allow carriers to deploy generalists where otherwise specialists are needed to perform risk assessments in the field—allowing insurers to better manage their workforce.
Finally, the precision and accuracy of drone-collected data far exceeds what humans can collect, improving the quality of claims adjudication. As a cherry on top, this accuracy also helps mitigate the risk of fraud.
All that rich data is useless if your core systems aren’t prepared to leverage it. Drone data, when coupled with artificial intelligence, creates immense value for carriers as they analyze data and estimate damage, and repair costs. A robust data strategy can also predict risk more accurately, while aiding underwriters and adjusters in creating more profitable policies that simultaneously improve customer satisfaction.
So, before you buy that fleet of drones, consider partnering with a data strategist to assess your current systems and prepare them to fully integrate with your new team of aerial data collectors. Pyramid has the engineering expertise to help you capitalize on the high value data you are constantly collecting by connecting that data across departments, bolstering analysis, and building better reporting capabilities — all in real-time. From consulting and strategy, to development, implementation, and support, we’ll stand with you as you build an advanced analytics program with the power to reduce costs, improve products and services, and create satisfied customers for life.