How location intelligence is advancing insurance innovation
While a newer concept, location intelligence and aerial imagery are proving to show exceptional value in providing insurers with a deeper understanding of their customers’ needs.
Moving beyond traditional zip code data, this technology leverages geospatial insights to paint a clearer picture of risk. Insurers, for instance, can analyze flood risks based on real-time elevation data or identify updated or degraded infrastructure. The integration of geospatial data with advanced analytics streamlines insurer operations by enhancing underwriting and claims processing into a single coherent framework.
In addition to these advancements, emerging technologies provide insurers with an enhanced level of support beyond mere data analysis. They enable continuous risk monitoring, dynamic claims visualizations and personalized safety recommendations for policyholders. It’s a win-win situation: insurers gain deeper business insights and customers receive more precisely tailored coverage and reduced premiums.
Property and casualty sector
The P&C sector is on the precipice of a paradigm shift. Worldwide premiums are expected to skyrocket to $10 trillion by 2030 due to inflation, rising labor costs, staff shortages and severe weather events. This impending financial milestone is catalyzing insurers to invest in new technology solutions such as location intelligence to write more accurate policies. This approach leverages aerial imagery and geospatial data to go beyond what the naked eye can see. The result is a nuanced, accurate understanding of property risk and further moves insurance firms to price and quote property risks accurately, setting insurers up for success from the get-go.
With location intelligence in the driver’s seat, insurers can proactively manage risk to pinpoint properties vulnerable to natural disasters, crime hotspots and other hazards. Take wildfires as an example. Insurers can better analyze factors increasing risk exposure, such as the defensible space around a property, its roof materials, or the distance between buildings. Having access to these specific insights then allows them to customize policies, rate and price more accurately, and potentially mitigate losses—or even prevent them from occurring. Ultimately, empowering insurers with precise risk assessment supports better customer service, operational efficiency, and future profitability. But more importantly, it becomes key to building a resilient future.
Optimizing underwriting and claims processes
Using detailed location intelligence, underwriters can minimize the risk of overlooking critical areas and verifying whether secondary structures affect risk criteria. This approach enhances traditionally slow processes of underwriting and claims management by integrating geospatial data with aerial imagery. Underwriters gain a comprehensive understanding of property risk such as flood zones or susceptibility to severe weather events like hurricanes, wildfires, and convective storms. For example, insurers utilizing location intelligence can reassess flood risks in coastal areas without relying on outdated maps and inaccurate data. They can then integrate current imagery, elevation data, and historical flood records to adjust their policies’ pricing structure.
This also moves insurers into proactively working on loss control, making it an integral part of the insurance policy lifecycle. When it’s time for renewals, location intelligence can provide up-to-date property intelligence enabling insurers to easily identify any new risks. These new risks can all be identified through innovative AI systems that highlight: Property repairs, deterioration of roofs and properties, and any property additions and secondary structures.
On the claims side, location intelligence acts as a powerful tool for adjusters. Adjusters can utilize collected location data to verify details of an incident, such as property location, land features or weather patterns during a weather event. Insurers can easily compare pre- and post-catastrophe imagery to estimate damages and deploy resources to the most impacted areas. This accelerates investigations, eliminates unnecessary delays and ultimately supports quicker resolutions on settlements. Moreover, it adds a new level of transparency, offering an objective layer of evidence during the claims process, benefiting both the insurer and the insured.
Emerging tech redefining the insurance space and policy lifecycle
Machine learning (ML) algorithms and generative AI stand at the epicenter of change in the insurance industry. But how do these technologies tie into location intelligence? For one, these algorithms are now capable of analyzing vast geospatial location datasets to predict potential risks—with remarkable accuracy—in a matter of seconds. This capability enhances the predictive power of location intelligence. More specifically, location intelligence leverages ML and generative AI to provide real-time insights into critical property characteristics like debris, roof condition and roof age.
This process allows insurers to create dynamic policies that fit individual needs and behaviors, moving beyond traditional one-size-fits-all models. For example, transitioning from risk assessment to claim processing, large language models (LLM), can streamline the claims process by automating the often-tedious tasks associated with it. An LLM can sift through a portfolio to automate data extraction, synthesizing this information into a comprehensive risk assessment. This automation allows insurers to focus on the more strategic aspects of their work, as it handles administrative tasks, expedites document analysis, and improves communication with policyholders. Additionally, this automation boosts insurer confidence and accuracy during the entire policy lifecycle.
As experts project nearly one trillion connected devices by 2025, these technological advancements are not simply modernizing the industry; they are redefining the very concept of insurance. We are witnessing a shift from repair and replace approach to predict and prevent for personalized risk management. These tech-driven innovations hold immense potential to make insurance more relevant, accessible and beneficial for all stakeholders.
Location intelligence has become an undeniable force taking the insurance industry by storm. By harnessing the power of geospatial data and advanced analytics, insurers are not only strengthening their financial health—they’re optimizing crucial processes and setting a new standard for data-driven, proactive industry practices. As location intelligence and its associated technologies continue to evolve, the future of the insurance industry promises to be dynamic, data-driven and proactive.
