The quality and volume of data to assess hurricane damage have improved dramatically, but to make a difference, there needs to be greater cooperation between the parties on the ground.
This article first appeared in Insurance Day on August 5th 2020. Many thanks to Insurance Day for allowing us to reproduce the article.
Hurricane Hanna making landfall marks hurricane season beginning against the backdrop of the global pandemic crisis, and ensuing lockdowns – a dynamic which potentially has serious implications for claims and exposure management across our sector.
For instance, if residents remain at home in lockdown conditions during hurricane season, this could also have an impact on claims – particularly as they are more likely to make extra efforts to improve the resilience of their dwelling. But remaining in the path of a hurricane clearly puts residents at higher risk, and this is a decision that must be weighed carefully against the alternative risk of mass evacuations and the potential further spread of COVID-19 as a result.
At the same time it’s likely that while both the insurer and insured side will feel reluctant to allow loss adjusters moving from location to location in person in the aftermath of a hurricane, particularly with the current acute nature of the pandemic crisis in the US.
It’s clearly a complex situation, and the onus is on re/insurance claims teams must demonstrate that they can manage and process claims and communications with policyholders accurately and efficiently under remote working setups.
In response to the unprecedented conditions leading up to this year’s hurricane season, the Florida Insurance Commissioner has recently called for greater discussion and sharing ideas on leveraging technology to protect and serve policyholders during this time, and indeed into the future.
In a briefing, David Altmaier, Florida Insurance Commissioner said;
“We strongly encourage insurers to identify new ways of doing business such as deploying virtual claims handling in order to protect consumers and increase efficiencies.
Leveraging technology can not only help to maintain important social distancing protocols, it might actually provide long-term efficiencies in the claims handling process ultimately benefiting the consumer.”
The Florida regulator also unveiled a plan to release an updated catastrophe reporting form to collect more data than ever before on the strategies insurers are using, technologies they are leveraging and volumes, values and life cycles of claims to keep a close watch on progress.
Remote handling of claims resulting from hurricane losses will clearly be critical to this year’s season. A smooth transition to a virtual environment is the first step, but thereafter the focus must be on getting the most accurate, real-time data on the impact of any hurricanes to ensure a speedy response to catastrophic events.
Curating the data available
Curating data from space and from the ground, alongside world class satellite and aerial imagery, has for some time now led to better informed business decisions for insurers.
For instance, we have enabled claims teams to enhance the accuracy of their exposure management initial reserving by up to 93% in the first 24 hours following a catastrophic event, and then for claims teams 72 hours later to make highly efficient triaging and reserving choices.
Being able to access accurate, time stamped and comparative evidence will play an important part in helping legitimise claims arising from hurricane losses, and in defending any legal disputes. In all cases the transparency, immediacy and reliability of the information provided is critical.
Giving in-house claims teams the right tools
Given the challenges we all face, efficiency will be more important than ever during this year’s hurricane season to allow in-house claims and legal teams to be able to positively impact several areas, including reducing expert spend, shorter claims life cycles, fewer contentious issues, reducing litigation and claims costs and, most importantly, improving the experience for policyholders.
Claims operations must be prepared and have all the necessary tools at their fingertips going into this cat season. Virtual claims assessments shared with policyholders are a key part of this, including real-time geotagged data and imagery of the impacted property that can be further augmented with imagery from the homeowner’s smartphone if available.
Leveraging the best technology available will support efforts to minimise claims adjusting or disruptions confirmation. Technology exists to allow claims teams to accurately pinpoint individual locations and review their entire exposure portfolio, and delivering an up to date, vividly high resolution imagery base layer. Such highly accurate exposure and claims data will prove invaluable to re/insurance teams.
Data is collaborative
It’s important that data and information is effectively shared, and collaborated on too. There are many data providers out there who can feed real-time data into systems to allow for truly cutting edge insights – we urge re/insurance claims teams to challenge their data providers on their sources and collaborative opportunities in this area. Intelligence derived from geospatial data and imagery analysis is critical to this mission. MIS has been working with Lloyd’s since 2016, offering deep and unique insight into the power of geospatial data and imagery and how it can be harnessed to provide a world-leading claims service.
Lloyd’s market service improvements
It is critical that intelligence and imagery can be relied upon implicitly, providing access to invaluable exposure management and claims data following global events.
Strong support from Lloyd’s claims and exposure management teams across the market and TPAs and Coverholders worldwide is also critical to the continuous process of improvement when it comes to accurately understanding hurricane exposure and claims management.
The technology and intelligence is now available – and getting better – to improve triaging and claims reserving estimates. But clearly increased cooperation between the parties who look to mitigate the cataclysmic effect of a hurricane, earthquake or other natural disaster, will further speed up claims payments to policyholders as they put back together their destroyed properties and businesses. And Lloyd’s, with the spirit of San Francisco 1906 in mind, is leading the way with this.