Insurance companies are increasingly using aerial images taken by drones, airplanes, and balloons to assess the risk of insuring homes across the United States according to a new report in the Wall Street Journal.
These images, which capture nearly every building in the country, are often taken without the homeowners’ knowledge or consent.
The aerial photos are analyzed by computer models to identify potential issues that could lead to insurance claims, such as damaged roofs, yard debris, overhanging tree branches, and undeclared pools or trampolines.
Insurers argue that this technology allows them to assess properties more efficiently and accurately, enabling them to charge rates that better reflect the risk of each home.
However, the use of aerial imaging has raised concerns among consumer advocates.
Fury as home insurance companies cancel coverage after secretly taking pictures of owners' properties using drones, high altitude balloons and even manned airplanes https://t.co/HGAyuQRchl pic.twitter.com/J9O0wwS7Ev
— Daily Mail Online (@MailOnline) April 6, 2024
Some homeowners have been dropped by their insurers based on these images, without being given the opportunity to view or challenge them.
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According to the WSJ Cindy Picos, a homeowner from Auburn, California, had her insurance policy canceled due to aerial photos of her roof that she was not allowed to see. Despite an independent inspection confirming her roof had years of life remaining, her insurer refused to reconsider its decision.
As insurance companies work to reduce their exposure to risk, the use of aerial images to justify policy nonrenewals has become more common. State Farm, for example, recently announced plans to drop coverage on tens of thousands of properties in California.
While state regulations limit the reasons insurers can cite for not renewing home policies, the failure to meet underwriting requirements, such as maintaining a home’s roof, is one of the few allowed justifications. This has led to an unprecedented level of nonrenewals in recent years, according to insurance industry experts.
As aerial surveillance technologies continue to advance, with the possibility of daily high-resolution property monitoring in the near future, the balance between insurers’ risk management needs and homeowners’ privacy concerns becomes increasingly important.
Consumer advocates worry about the lack of protections and the potential for misuse of the data collected.