How Insurance Companies Are Using Drones to Raise Your Rates (and What to Do About It)
If you own a home, you know that homeowners insurance typically requires inspections—at least once when you initially take out a policy, and often periodically when it’s time to renew. There’s usually no way to avoid this—the insurer has a right to make sure they’re not taking on too much risk . They don’t want to be on the hook for a huge repair bill because you didn’t bother to properly maintain your roof.
Typically, you know when these inspections are coming, so you can prepare your home. But increasingly, insurance companies are using less visible tools to inspect the exterior of your home, using drones and satellite imagery to check that your roof is in good condition, that you’re properly maintaining your exterior walls and landscaping, and that you’re not using your property in a way that violates your insurance policy. And you should care about this because it changes the fundamental dynamic around home inspections. Here’s what you need to know — and how to respond.
There are several reasons why drone and satellite inspections may be problematic for you as a homeowner:
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Unreliable. Drone and satellite images are often of fairly low quality. A Florida man had his insurance cancelled when a drone took a picture of his roof — he described the photo as “looking like it was taken in 1936. ” These images often contain shadows and artifacts that are mistakenly interpreted as damage, and insurers sometimes select satellite images that are years out of date and use them to justify raising rates or canceling policies.
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Unpredictable. Unlike a scheduled inspection, a drone can fly over and around your home at any time. This means that if you are renovating any aspect of the exterior of your home or have work scheduled, the photos may not show an accurate representation of the condition of the property. This could lead to false accusations of deferred maintenance or damage, leading to unfair rate increases or cancellations.
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No warning. These inspections often happen without your knowledge, so the first time you may hear about them is when you receive notice that your rates are going up or your insurance won’t be renewed. At that point, it can be much more difficult to fight the decision if the physical condition of your home has changed. And it takes away your opportunity to make adjustments before the inspection if you’re doing something to the property that you know could be misunderstood or misinterpreted.
Precautions you can take
We live in the age of drone inspections, so it’s time to start taking extra precautions. Your first line of defense against a shocking cancellation or rate increase due to a drone or satellite inspection is to know the basics of your homeowners insurance:
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Cancellation Notices: Find out the cancellation notice requirements in your state. If your insurer relies on an automated system, you may receive a cancellation notice without proper notice, and you may be able to fight it.
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The Complaint Process: Don’t wait until you’re fighting a cancellation to learn the process for disputing changes to your coverage—you may only have a few weeks to fight back. Learn how to file complaints so you don’t waste time. You should also know how to contact your state’s insurance department if you need to file a complaint about how your insurer is handling the situation.
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Look at the exterior. You may not even be aware of aspects of your home’s exterior that drone footage or satellite images may highlight. If your roof is in good condition but has moss growing on it, for example, that may be noted. Consider what your home looks like from above .
Also consider that parts of your home that you may think are private are actually vulnerable to drones and satellites. For example, a trampoline or treehouse in your backyard may seem harmless and safely hidden from prying eyes. But if a drone spots them on your property, it could result in your insurance being cancelled or your rates being raised.
What to do before (and after) a rate increase or cancellation
One way to avoid unexpected events caused by drones and satellite images is to stop waiting for inspections to perform necessary maintenance . If you usually wait for your insurance company to announce an inspection to repair your roof and do other work on your home, well, stop doing that. Regular maintenance and repairs to the exterior of your home will protect you from unpleasant surprises caused by drones.
If you receive a rate or cancellation notice from your insurer based on drone or satellite photos that distort the reality of the situation, ask to see the photos that were used to make the decision. If they are blurry, low resolution, or show misleading shadows or angles, take your own photos and provide them as part of the dispute process with your insurer. Chances are, your photos will be clearer and will refute the claim.
You can also hire a home inspector to provide a report. If a drone inspection reveals signs of roof failure or collapse, a report from a certified inspector detailing the age and condition of the roof can be conclusive.
These days, any inspection dispute probably starts online or via email, but it may be worth talking to a human on the phone . Automated systems often lack flexibility, leading to pointless disputes or requests being rejected. If inaccurate, outdated, or misinterpreted drone photos are ruining your homeowners insurance, talking to a human on the phone may be your best chance to turn that scenario around.
If you know there are aspects of your home that could be picked up by a drone or satellite view of your property – a swimming pool you haven’t told your insurer about, or the aforementioned trampoline – there’s one final rule: don’t try to hide it. Covering things with tarps or other camouflage won’t work, and could actually get your policy cancelled on its own, as they could be perceived as red flags.
If you are concerned about something on your property in relation to your insurance coverage, it is best to either get rid of it or see if you can add coverage for it to your existing policy. Trying to hide it from view in the sky will almost certainly backfire.