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AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

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Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#21
post #5

I’m frankly surprised this is legal. I can’t imagine something like this passing in the EU.

Compared to the EU, the ostensibly relies more on litigation and less on regulation to keep things in check. This has, in turn, led to a more permissive attitude where, in general, anything goes unless and until people can successfully sue over it. Which, in turn, doesn't happen because we have a thing called forced arbitration that prevents most consumers from suing over most things - instead they have to go to an "arbitrator" who is chosen and paid for by the corporation in question, and therefore extremely highly motivated to not decide cases in a way that might cause their client to take their business elsewhere.

And, thanks to our darn near unrestricted version of free speech and a Supreme Court ruling that tore down most restrictions on political lobbying by ruling that spending money also counts as a form of speech, corporations spend an obscene amount of money on getting buddy-buddy with legislators. So the legislatures also tend to be incredibly slow to act on these kinds of things because they don't want to bite the hand that feeds them, either.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#23

Expanding on this idea - can health insurance companies fly a drone over my house and see me in my hard eating a cheeseburger and cancel my coverage? Can an auto insurer do the same and cancel my coverage because they see me doing burnouts in my driveway? Seems like a giant privacy violation but I'm no legal expert.

There's every reason to assume that these applications are the ones actually backing Open AI and co's insane valuations. They want to use these products to lock consumers down even harder. Actively rewrite contracts that already favor them, to favor them even harder. Cancel contracts that look to need payouts soon. Determine risk assessment for insurance policies, mortgage holders, and screw every last customer out o…

This is my opinion too. The real profitable application of current AI is surveillance and the removal of human empathy from the corporate equation.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#24
post #11

Another tech asymmetry that puts consumers at a disadvantage. I wonder if there exists any kind of service for similarly leveraging technology to help consumers find claims opportunities. E.g. run a drone after a hail storm to look for damages that consumers could file claims with. Ideally the carrier would also be doing this, but most aren't going to volunteer money away.

Normally homeowners do have an information advantage: they know more about what's going on with their property than the insurance company, or could find out. I don't think the occasional drone oversight is going to change that much, other than for the most obvious problems.

It seems like whoever pays for an inspection (such as using drone surveillance), it should be shared with the other party?

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#25
post #5

I’m frankly surprised this is legal. I can’t imagine something like this passing in the EU.

Compared to the EU, the ostensibly relies more on litigation and less on regulation to keep things in check. This has, in turn, led to a more permissive attitude where, in general, anything goes unless and until people can successfully sue over it. Which, in turn, doesn't happen because we have a thing called forced arbitration that prevents most consumers from suing over most things - instead they have to go to an "…

The sounds incredibly like a version of hell.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#26
post #5

I’m frankly surprised this is legal. I can’t imagine something like this passing in the EU.

I think the details around this vary a lot from country to country. I work for a Norwegian insurer, and I’m pretty sure that we couldn’t cancel a contract like this short of something like fraud. OTOH, contracts are renewed annually, and I think declining to renew would be an option. But damages due to lack of maintenance are not covered anyways, so I’m not sure if there’s much incentive for this kind of thing in our market.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#27

Drone or no drone, insurance companies shouldn't be allowed to suddenly drop a covered customer, without having to work with the customer on correcting whatever they are concerned with. There should be a mandatory grace period allowing the insurer to provide notice and list whatever corrective actions they required, and for the customer to either dispute or take those action. "The Market" is clearly failing to provid…

Same as a “fix-it” ticket for having a busted tail light. You prove to the court that you got it repaired and you don’t have to pay a fine.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#28
We had such a notice, for moss and mold (in a hot, dry climate). The images were accurate enough. The insurance company relented after we remediated and sent photos.

Image recognition is not really "AI-driven", and the low numbers make that replaceable with humans. It's the cost and legality of drone roof photos that make this possible.

The risk represented in the photos was relatively small, but it's a risk easily and legally measured. Then the higher cost of fix + verify is shifted to the homeowner.

The real beneficiary is roofing companies, raising the question of illegal tying. Insurance is required by mortgages, so homeowners have no choice but abate with roofing services, which creates an opportunity for the insurance company and roofers to share value extracted in various ways. Which ways are legal is an open question. The value extracted is bounded by the cost of switching, which involves another company assessing your property in some way; tight home insurance markets thus increase the value extractable.

Insurance mandates and reliance require regulation, as does using private insurance for large social risks like wildfire and earthquakes, but that all makes insurance less competitive by reducing viability of new entrants.

Nothing in the chain of reasoning - from drone pictures to investor decisions - is improper, but boy the resulting homeowner squeeze is painful.

Re: AI-Driven Drone Surveillance Is Leading to Home Insurance Cancellations

#30

Expanding on this idea - can health insurance companies fly a drone over my house and see me in my hard eating a cheeseburger and cancel my coverage? Can an auto insurer do the same and cancel my coverage because they see me doing burnouts in my driveway? Seems like a giant privacy violation but I'm no legal expert.

An elder care insurance provider definitely sent private investigators after the parents of someone I knew. Their way of getting out of the plan was that he was lifting cardboard boxes: something that his condition should not have permitted. Your car insurance isn’t high value enough but yes they already do this otherwise.

Your personal insurance isn't, but once the tech is perfected to operate on the ones that are, there is zero reason to assume it won't also be deployed to yours.

Progressive is one company that insures 27 million drivers. If they deployed this tech to all of them and it earned them a paltry $2 more annually per driver, that's $54 million in extra revenue. And any company that dares not do it once it's widely adopted will have shareholders screaming at them to implement it.

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