As vice president and chief claims officer for Motorists Insurance Group, Teresa King keeps a keen eye on the future, especially when it comes to technology that can help her company’s claims professionals stay competitive and excel above the rest. As of late, her attention has zeroed in on how drones might be used in the claims process. She chats with Claims Management’s Eric Gilkey about why this technology has captured her attention of late, how she thinks carriers will use it, and the risks involved in implementation.
What is it about drones in particular that pique your interests?
There are lots of technologies that I think are interesting, but drone technology is really fascinating. It’s great for catastrophes because you can do flyovers and get into buildings that you wouldn’t otherwise be able to inspect, and we get detailed images and videos of the damages. We even had a drone demonstration at our building last year. They circled the building, and you could see the faces of everyone standing outside in great detail.
The Federal Aviation Administration (FAA) has started allowing companies to use drones commercially. Do you think insurers will begin to fully adopt this kind of technology and use it more in their daily operations?
We expect to see development in drone technology now that the FAA has granted limited approval. We have partnered with several companies that are on the forefront of this technology, and we see the potential for even greater development moving forward. While the current technology is great, we have seen limited usefulness for daily claims thus far. Our usage to date has been limited to assessing roofs that are difficult to access. We view the greatest potential for this technology in post-catastrophe event evaluation by utilizing fixed-wing drones that can survey a large area. We doubt this is something that we would take on ourselves, as the costs associated with each event would outweigh the benefits. We likely will remain consumers of the data from a vendor that is able to scale the costs of the technology to multiple partners.
What kinds of loss scenarios do you imagine drones being used?
Residential and commercial roof claims and post-catastrophe response seem to be the best fit for drone usage. We can see some application for commercial structures that may be unsafe to enter or difficult to inspect based on location, damages, or conditions.
However, we see the usefulness of this technology reaching beyond claims and into risk management and underwriting. Roof and building surveys on large commercial properties could be much more accurate with this technology. As I understand it, some larger insurers already have invested in drone technologies.
What are the risks associated with using this kind of technology?
We see several risks associated with drone usage. Drones are heavy, have short battery lives, and have propellers that spin at a high rate of speed. This can be a dangerous combination that can cause injury or property damage under the use of someone who is untrained. Additionally, there are privacy concerns with this technology, especially when used in residential areas with neighboring properties. For these reasons, we have concerns with using drones at the field claims professional level. There would also be time and cost associated with appropriate training and certification to man and operate this type of sophisticated equipment.
Do you vet vendors that offer drone services?
Yes, we already have a process of vetting vendors when we want to use this technology on our claims. We make sure they have specific unmanned aerial vehicle insurance coverage; we ask them to indemnify us in the event of an injury, property damage, or privacy claim; and we require a signed disclosure of the usage from the property owner. Additionally, we make sure to verify FAA qualifications.