This blog has discussed several times the difficulty of getting and maintaining homeowner’s insurance in some locations, especially coastal areas. This appears to be an extremely difficult issue in Florida, and I have heard similar concerns along South Carolina’s coast.
The Wall Street Journal is now reporting that insurance companies are increasingly using aerial images from drones and balloons as a tool to cancel insurance on properties deemed as higher risk. You can read the article here. Googling the topic also reveals several related stories.
Apparently, angry homeowners are reporting losing coverage because of images reflecting damaged roofs, debris in yards, and undeclared hazards such as swimming pools and trampolines.
Consumer advocates object to this tactic on privacy and other grounds. For example, the images could be outdated or otherwise inaccurate. Time frames for correcting the problems may be too short. And the secrecy of the “inspections” may be deemed to be unfair.
State law may require inspection reports to be delivered to the consumer, and some state laws may limit the reasons insurance companies may use to fail to renew coverage.
According to the articles, insurance companies find the use of aerial images is an efficient way to capturing data. The technology is sophisticated and continues to improve. The companies also claim that weeding out risky properties through visual inspections helps everyone by decreasing claims.
Of course, this issue arises as we are seeing increasing premiums in homeowner’s coverage. Count on homeowner’s coverage continuing to be in the news.