This study’s aim was to assess both the technical feasibility and economic benefits of providing services that can be used by the insurance industry within the claims management process. Specifically the study will determine how space assets can be incorporated into the claims process, such as using EO datasets to assess extent and severity of the property damage or using GNSS and satellite communications to enable greater transfer of information between a central office and the loss adjustors in the field undertaking claims verification.
This study was driven by the needs and requirements of the end user organisations. Such requirements were defined by engagement with end users, both insurers and loss adjustors, from the insurance industry in the UK, mainland Europe and North America. These needs and requirements were used to define the user-driven services and the system needed to deliver them, which were also evaluated and validated technically within the proof of concept stage.
The study also evaluated the commercial viability of these services that can be used to provide more rapid risk exposure estimates, initial damage assessments, both in terms of extent and severity of damage to insured assets, and improved communications with the loss adjustors in the field.
Upon conclusion of the study, a roadmap for further implementation of the system as a demonstration project was prepared.
Users and their needs
The insurance industry recognised there are a number of aspects of their current claims process which could be improved and therefore provide business benefits, in terms of faster claims settlement, reduced levels of fraud, less disputed claims and cost savings. These include:
- Need for improved models and modelling of risk exposure of assets,
- Faster response to events and claims in terms of estimating volume of potential damage in the immediate aftermath of an event or claim
- Improved understanding of the levels of damage to an individual asset, such as a building, which can be used to quickly determine the validity of a claim and in extreme cases, settle the claim.
Need to improve the levels of communication with the loss adjustors in the field and to exploit technological advances with the aim of being able to collect more evidence regarding a claim and ultimately settling a claim faster.
These are two actors within the insurance claims process:
- Insurers: who actually insure an asset and are liable for payment of a claim. As such need to understand and quantify both potential losses, i.e. their risk exposure and actual losses against which a claim is made. Their interest in in a portfolio of assets.
- Loss Adjustors: are commissioned by insurers to go onsite to verify and settle individual claims. Their main focus is to increase the amount of evidence they can collect on a claim and improve ways in which such information can be accessed and communicated.
Although it is envisaged that the VeriSpace solution would be offered worldwide, the insurance industry has a very strong presence is Europe and the majority of our engaged stakeholders are European. As such it is envisaged that the initial focus of the service would be Europe and North America.
Service/ system concept
The proposed VeriSpace services will include:
- Provision of service that allows for the routine searching and purchasing of EO imagery over a user defined region or specific insured asset
- Provision of a service that will provide rapid damage assessments based on interpreted EO imagery that can be used both to determine extent of potential losses and within claims verification and settlement
Provision of communication tools that can be used to improve levels of communication and transfer of data with loss adjustors in the field who are collecting evidence for claims verification.
Space Added Value
EO satellite imagery provides the ability to collect information on the asset and its surrounding region on a routine basis, and when an event occurs this can be potentially be used to provide information on large areas much faster than manual inspection by loss adjustors.
GNSS can be utilised to enable images and data collected in the field to be accurately geo-tagged allowing it to be confidently associated with a particular asset. In some more severe cases where the terrestrial communications have been compromised, the use of satcomms can ensure connectivity with loss adjustors in the field.
The main advantage of the defined VeriSpace services is to improve the amount of information regarding an asset that can be accessed by those involved within the claims process. Such information can be contextual information that can be used to estimate better risk, initial damage assessments used to estimate overall losses and in situ evidence used to verify specific claims and to reduce the extent of exaggerated claims. A key advantage of using space assets will be the ability to provide such information at a faster rate than conventional methods. Additionally, the project will improve the connection between image suppliers and the users by acting to efficiently direct enquiries and information in each direction, helping EO data providers to tailor their services to the insurance industry.
VeriSpace developed these various services based on user requirements rather than through a technological ‘push’ approach. As such the focus was on providing cost-effective services which complement established processes.
The main advantages of using space assets are their global coverage, independence from terrestrial infrastructure and consistency. For EO this gives confidence that imagery can be collected over a particular asset on a routine basis for regular updates of current status of an asset. Additionally, imagery can be collected soon after an event that provides a broader understanding of situational information than other methods. For GNSS and Satcoms this allows a loss adjustor in the field to have confidence that they can collect and transmit data with accurate positional information irrespective of the local infrastructure.
The VeriSpace feasibility study is now complete. The study has defined and validated, both in terms of technically feasible and economically viable, two complementary services that utilise space assets for use within the insurance claims process. A Roadmap has also been created, which defines how these services can be developed through a demonstration phase to a fully operational service that maximise user benefits.
The next step will be to take this project into the demonstration phase. The consortium is currently engaging with the end users to ensure their commitment to supporting any resulting demonstration project.