Traditional insurers add drones, other innovative tech to modernize their toolkits

Editor’s Note: This is the first in an ongoing, occasional series examining use of cutting-edge technologies by the insurance industry, including traditional carriers and insurtechs.

Alex Hartson probably doesn’t get much of a reaction in social situations when he tells folks he’s a claims adjuster for a big insurance company. But when he mentions his secondary duty as a commercial drone pilot, he’s sure to spark interest and questions.

Hartson is one of 700 professional drone operators trained and employed by Travelers Insurance who are on the cutting edge of claims processing. Gone are the ladders, measuring tape, Polaroid cameras, and other arcane tools of past claims adjusters. With drones, professionals like Hartson can measure, assess, and report, roof damage, gutter and chimney wear and tear, and a host of other property claims issues without ever leaving terra firma.

“So as long as there's no airspace restrictions, we're flying at almost every one of our property inspections.  And that becomes extremely more instrumental when there's a safety concern on the house, or there's a structural concern, being able to put something in the sky that gives you a great aerial overview before you physically try to access something that may have downed power lines or trees through attic spaces and things of that nature.”

“It's a tool that we have in our capacity, where if it's going to help us from an efficiency standpoint, or a safety standpoint, we want [policy holders] to consider it as their first option that gives them a good glance at what's going on with the property,” Hartson said.

Travelers, for example, has a proprietary geospatial tool to accompany its drone strategy, that maps almost the entire country with high-resolution photos used to compare with photos taken after a catastrophe such as a hurricane, tornado or wildfire.

By embracing technological solutions such as drones, Travelers is joining other old-line insurers that are working to bring new and innovative features to a centuries-old business that hasn’t really changed much since its inception.

Partly as a result of consumer demand for the Amazon-like service experience, and partly due to the supposed threat – as of yet largely realized – of young insurtechs to disrupt the industry, traditional insurers are investigating and investing heavily in new consumer friendly high tech tools. Utilizing artificial intelligence, data mining, analytics, even virtual reality goggles, the dusty old insurance industry is just now coming into the technological age.

Travelers, for example, has a proprietary geospatial tool to accompany its drone strategy, that maps almost the entire country with high-resolution photos used to compare with photos taken after a catastrophe such as a hurricane, tornado or wildfire.

AI provides claims information

“What we have is an AI program running in the background that will tell us all sorts of things like how many approximate claims we're going to have, which customers have more serious damage versus which customers have less serious damage,” said Jim Wucherpfennig, vice president property claims at Travelers. “So even before claims are reported, we have a pretty good idea of not only how many claims we're going to have, but how severe the incident is going to be for our customers.”

Travelers, Wucherpfennig said, is about to roll out yet another program that will do for interior claims adjusting what the exterior technology assessment programs do. And it will integrate with programs that provide contractor repair referrals.

“You know, with the supply and demand and inflation that we have today, the next thing customers want is, ‘who can repair the property for me to this estimate,’ ” he said. “And so, we have another completely digital platform that we offer to give customers contractors in their local area that will complete the job for the estimate that we have written.”

Travelers has partnered, and invested in, a Silicon Valley software company called Aloft, which is an FAA-approved supplier for the federal government’s Low Altitude Authorization and Notification Capability program, a collaboration between the FAA and industry.

Drone pilots fly and maintain aircraft, and manage drone data. With each flight, data – including telemetry, video, photos, authorizations, and battery life – is automatically fed into the secure cloud, providing the insurer of real-time views of its entire fleet. It gives the company a single source record for all critical data points connected to its drone program.

'More digital capabilities coming'

“We see a lot more digital capabilities coming to meet the customer and give them the technology that they want to interact with us,” said Wucherpfennig. “We see more straight through processing on simpler types of property claims where a customer can do things on a digital platform, and largely process their claims through digital capabilities. There’s a lot we're currently working on and testing and kicking the tires on.”

Automating the entire insurance processing system is the goal now of many insurers who, some say, have been slow to invest and build new technology systems. Even now, many computer programmers, software writers, and other high-tech companies, claim that the insurance industry is their building their market. But when asked to supply names of companies or people availing themselves of their products, they decline.

But, most analysts believe, they will catch up, if for no other reason than to preserve their market share as consumers yearn for efficiency, speed, and ease of use in dealing with insurance companies.

Technological innovation can also serve as a recruitment incentive for an industry badly in need of attracting young talent to its field.

“It really has changed our dynamic where it’s becoming true,” said Hartson. “I recently had an interview with a person applying for a technical specialist role in our claims department and they mentioned the reason they joined our property team is they met somebody who talked about being a drone pilot. This is stirring up a lot of interest, and it really is a neat tool that that we've been provided with.”

Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].

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Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].