25 Nov Severe Weather, Blind Spots, and Drones: P&C Insurance is Responding
Nasa image of global weather patterns
Climate change, cybersecurity threats, and legacy IT systems are pushing traditional approaches to property and casualty (P&C) insurance to their limits. The latest Next-Gen Risk Readiness Index from Nearmap, developed with comprehensive research by Reputation Leaders, highlights the transformational role of technology in overcoming these obstacles and preparing insurers for the future.
1. Climate Change: A Foremost Challenge for Every Insurer
With every US state now classified as a catastrophe (CAT) state, severe weather events like this year’s hurricanes Helene and Milton have caused $145 million and up to $100 billion in damages respectively. The industry is feeling the effects, with 7 out of 10 (69%) insurance industry professionals reporting significant disruptions due to extreme weather.
“Every state is now a catastrophe (CAT) state. Every carrier is now a CAT carrier. As I look forward, our industry must move quicker to adopt technology—not only to price risk more effectively but to provide data and tools that help insureds become active partners in risk management.”
Dave Tobias, GM of Insurance, Nearmap
2. AI and Aerial Imagery: The Game Changers
One solution is the use of AI coupled with aerial imagery. Planes or drones are used to capture high-resolution aerial photography; this data is then analysed by AI to provide more personalised policies and pricing and to mitigate fraud. Despite its immense potential, only 18% of P&C insurers currently utilise AI-derived insights from aerial photography. Yet, 59% believe AI will power most operations in the near future. This disconnect between adoption and ambition underscores an opportunity for insurers to lead the charge in innovation.
These technologies are not just about efficiency; they are about reshaping customer satisfaction and risk management. For instance, 38% of insurers saw increased client satisfaction due to faster, more accurate claims processes.
Additionally, this new technology offers the potential to mitigate risk and provide more nuanced and informed decisions about properties and policies in climate-impacted areas.
3. The Blind Spots: Cybersecurity & Privacy
While climate change is the greatest concern, our research revealed that cybersecurity and privacy concerns are the greatest P&C industry “blind spots”, according to industry insiders. Over 34% of insurers identified cybersecurity as a top blind spot, with privacy issues and fraud close behind. These risks are exacerbated by outdated IT systems and limited predictive capabilities.
To find out more, you can read the full report here.
How Reputation Leaders Can Help
As a leading reputation and thought leadership consultancy, Reputation Leaders brings a unique blend of industry knowledge, research expertise, and strategic insight to every project. Our collaboration with Nearmap is a prime example of how we translate complex data into compelling narratives that drive change.
This report is more than an analysis of challenges; it’s a blueprint for transformation. By leveraging advanced technology, insurers can not only weather the storm of emerging risks but also emerge stronger.
If you would like to partner with us to create research-backed insights that position your organisation as an industry leader, contact Reputation Leaders today.