How can images gathered via satellite be effectively used by underwriters?
Advances in satellite imagery have increased over the past 15 years, particularly within the last several years as the technology has drastically improved the clarity and quality of images. While those improvements have made the usage of aerial imagery more acceptable in the property and casualty insurance industry, in many circumstances, such as newer or recently updated homes, or those located in less populated areas, it remains insufficient to properly underwrite a risk. The details of home construction and accuracy of conditions and hazards on a property really require boots on the ground in the form of an experienced property inspector.
Satellite images typically lack the close-proximity photos on conditions which underwriters require in order to take action, nor can they identify issues like aggressive dog breeds, trip and fall hazards, the true occupancy of a property, and issues with surrounding trees, among others.
A major concern to all carriers needs to the the timeliness of images that they are utilizing. Different aerial image distributors provide significantly different frequency of updates to their images. The two photos below are examples of the same house available through two different providers. There are a number of apparent differences that would impact an underwriter’s perspective and their determination of this h0me.
The first photo shows a much larger rear porch and a smaller living area, while the second photo has a clear addition to both the front and rear of the home, increasing the TLA, as well as an expansion of the gable roof and a decrease in the rear flat roof. Additionally the lack of clarity in the second photo makes it very difficult to see any issues with trees overhanging.
Finally the quality of both pictures make it impossible to determine the estimated life and adverse condition of the roof, the leading source of claims for insurers; that information is absolutely critical, and is only available at this point through a physical inspection.
Aerial imagery can be useful in situations where accessing the property is limited, such as accessing areas behind privacy fences, or for validating the relative wall dimensions gathered during an inspection.
Recognizing the benefits and limitations of aerial imagery is critically important for carriers to developing a successful underwriting strategy which utilizes them.