Insurance company drops customer saying a 'drone' took photos of clutter in yard
abc7news.com
abc7news.com
The drone/aerial surveillance is the headline here, but the real issue is that insurers are unilaterally canceling policies without any sort of grace period or remediation possibility. Bear in mind that if you lose your home insurance and don't sign a new policy, a lender can and usually will foreclose upon it.
That should be illegal for the foreclosure. There should be a grace period. What if your insurance company goes bankrupt, or some other calamity?
Without an active policy, the lender is subject to much greater risk. If the house burns down sans insurance, the lender is now SOL.
And as the sibling response states, foreclosure is rarely a fast process. The problem is it can be very hard to find a policy if there's a gap in coverage, even more so if insurers are leaving the market.
CA and FL have their own problems due to local weather/climate (fires, hurricanes) and insurance regulations. Insurers are jacking up rates in FL and leaving that market. I'm not as familiar with CA, but it sounds like they're doing the same there.
https://www.kpbs.org/news/economy/2023/07/07/californias-hom...
This has been my experience when the lender screws up and fails to accurately record the insurance information. Then, near the expiration date, when they check, and find nothing, one gets a nasty-gram in the mail berating one for failing to maintain insurance, and indicating that if they don't get proof of insurance within 15 days of the date on the letter (of which at least five days has usually already lapsed), they will apply their own insurance, to the tune of 4x the cost of the actual insurance that is still valid and active.
But if this happens in sufficient numbers, then lenders will likely rethink that policy. No lender wants to foreclose, and particularly if there's no chance that they'll be able to sell the property for enough to cover the costs of foreclosing.
Are you sure this is correct? In this situation, lenders will usually do something called a force-placed insurance: https://www.consumerfinance.gov/rules-policy/regulations/102....
Note that this is sometimes the result of those in high risk situations managing to get the legislature to require the risk to be spread to others to keep their rates from being insane. (Florida is a prime example--they're spreading the cost from property on the front line for hurricane damage across wider areas, so now everybody's insurance is high rather than some being completely uninsurable.)
While I have not kept up with the California situation I suspect something of the sort is going on, they aren't being allowed to look at local wildfire risk in setting premiums.
(I work in pricing for a large insurer)
IF Californians don't change their collective behavior around addressing the issues related to wildfire risk, its unlikely they'll be able to maintain coverage.
Put differently, if a fire were to happen and this open air mechanics/tire shop were to ignite and destroy the three neighboring properties, is this homeowner entitled enough to pay all damages caused by his negligent storage of combustible materials?
[edit] Plenty of notice should have been provided so the property owner had an opportunity to address the issues found, which may or may not have happened. We only have one side of the story here.
Again, a description like really misrepresents the facts. The guy appears to own 2, possible 3 motor vehicles, and has two sets of 4 tires. It looks as if he had hoped to upgrade one of his vehicles by putting some shiny new wheels on it. O am not a car guy, but this looked to me like some personal property stored in his yard, not a hobby that had spun out of control. If he had stored them in a shed or covered storage area nobody would have said anything (because they wouldn't have seen it) even though the risk would have been identical or greater. There's no particular reason to expect a fire to break out in the middle of a subdivision, tires aren't known for just spontaneously bursting into flame.
By contrast, in my neighborhood there is a tire business of some kind at one end of a residential street, which must have 2-300 tires stacked up, directly adjacent to a bunch of houses and a freeway overpass. They've been there for man¥ years so I assume it's a normal business with normal permits, even though it's a massive fire hazard with a higher risk of a fire breaking out from the unpredictable nature of commercial traffic, industrial equipment, vandalism/arson etc.
The main issue for insurance companies arises from a combination of California's increasingly hot and dry climate and the fact that most uses here are made out of wood and thus extremely susceptible to fire damage. The people rationalizing the insurance company's decision as if this guy somehow had it coming are BSing themselves.
5 cars. 1 on street, 3 porch, 1 tarp. Most likely two more in double garage.
>and has two sets of 4 tires
Over 30 tires, some truck sized (bigger than what that astro van? uses). Rusting engine block, heads, plus transmission case, exhaust and fender/hood in the grass.
Reporter material shows fresh garbage bags in the yard suggesting dude started cleaning the moment he got the rejection. Whats more drone footage looks to be recorded after on the ground clips, with backyard meticulously cleaned, things neatly stacked (still 6 piles of tires) and overgrowth mowed.
>in my neighborhood there is a tire business
In commercial zoning, paying commercial insurance.
To you it may not seem significant but to a wildfire risk specialist, these are precisely the kinds of hazards were looking for.
The standards are high, but they are so for a reason. We're losing thousands of homes per season to wildfire.
Was it bad customer service to just drop him? Yes. Should he have the opportunity to mitigate? Absolutely.
But ignorance of your risk doesn't mean some one else is obligated to take the other side of that bet. I've said it a couple times else where. If insurance companies thought they could still be writing policies in California, they would. It's billions of dollars in annual premium they are passing on. They aren't doing so because, yes, storing tires against your house is significant enough of a risk factor to warrant non-renewal. Companies like State Farm would rather pull back entirely than accept the risk.
Wonder if those tyres would change that risk factor, as tyres burn pretty well.
Yep. This is something we've been working to address at my startup (https://wuuii.com/). We build software for doing these kinds of inspections. Getting property owners to take action is one of the critical steps in the process, but communicating clearly what needs to be done is something we focus on. We use a combination of aerial imagery and on the ground inspection to identify all of the issues and make specific mitigation recommendations.
https://www.avantaventures.com/wp-content/uploads/2020/10/Av...
Cape Analytics' documentation says that UAV carries higher resolution than is necessary and most of their stuff is done with aerial fixed-wing aircraft. Not that it matters for how crazy this story is, I just wanted to inject some facts into the conversation.
Unless the property is ridiculously expensive, don't expect any one to commission a flight for it.
Moreover, their identification is (from the article) erroneous, and their risk claim is false (per the article the person is not in a fire zone). Failing to acknowledge those are erroneous and continuing to terminate the policy is BS, and I assume fraudulent: if the law allows an insurance company to do zero-notice termination of policy without a justification I'm sure that they would have done that instead, rather than providing any justification that could prove wrong.
These companies use multi camera oblique imagery that can get views down the side of houses were you can do a 'good-enough' job assessing at least some of the major factors for wildfire risk. Debris or outside storage would fall into this category.
Dealing with outside storage and debris are part of both the Safer From Wildfire standard and the Wildfire Prepared Home standard. Addressing ember accumulation areas (read: any where leaves/ dust/ crap piles up) adjacent to a structure or any where else on a property is one of the easiest things a home owner can do to reduce their overall risk. Its cleaning up your yard and moving things that might catch on fire away from your house. If you have a problem with that and live in even a mild wildfire risk area, good luck maintaining coverage. This is the absolute lowest hanging fruit with regards to reducing wildfire risk.
Sources:
https://www.insurance.ca.gov/0400-news/0100-press-releases/2...
Just saying that this sort of thing is far from new.
And neither your nor my example are nearly as problematic as the article. The article is an entirely new class of bad.
Property insurance historically has some of the best consumer protections, its one of the oldest "private subscriptions" that fills a critical need. But new technology can easily disrupt a balance of power set decades ago.
The issue California faces isn't a technical one. Its a social/ behavior issue. Californians will need to change their behavior with regards to how they manage their personal property or the risk will continue to be too high for insurance companies to bear. These properties aren't struggling to get insurance because suddenly we have aerial imagery; they are struggling because the data regarding wildfire risk has become impeccably clear.
Individual actions can make an impact to their individual and community wildfire risk, but fundamentally wildfire risk is a network phenomena. It has to happen at scale. If a homeowner isn't willing to deal with debris piles on their property they are putting themselves and their community at risk. Should they get insurance?
But I can tell you this right now, with what I saw in the video he won't pass. He's storing combustibles too close to the structure. It puts him at significant risk.
At my company we see customer service as the top priority and try to partner with homeowners to both understand their risk and take action. This is why we focus our reporting so much on education around the issue and communication about what matters for risk.
Ultimately however, the onus is on the homeowner to take action. It's no one's responsibility but theirs to understand and mitigate their risk. I think many home owners are naive as to how high their risk really is. Look at the reaction to Oregon's recent risk maps. The maps were accurate, and the public panicked. Now they are wordsmithing the science to down play the risk. Rearranging the deck chairs does nothing about the underlying hazard.
Link to the Oregon story: https://katu.com/news/local/oregon-lawmakers-insurance-commi...
https://www.verisk.com/insurance/products/personal-aerial-im...
I seem to remember reading on Twitter that 80% of the population of the US is photographed every 3 months or so by services like this.
Also
https://www.alliedmarketresearch.com/aerial-imaging-in-insur...
Would it make all that much difference if they'd sent out an artist on horseback, to depict his property with quill and ink on parchment?
From the drone operator's side, the pay for this kind of work ranges from ~$50-150. Based on the research I've done into the companies posting jobs on these sites, they seem to be charging ~$200. I'm sure large customers with lots of jobs get a significant discount, too.
TL;DR: The ubiquity of drones these days has driven the cost of this sort of data collection way, way down.
Would they be within their rights to drive up a truck with a long ladder, climb to the top and look in on his property?
Insurance companies also use location data for this. All of the data people aren’t concerned about losing on social networks and cell providers is being used for these purposes too. And it’s really just started since 2018 or so to get implemented in insurance companies.
The insurance companies are always looking for mitigation technologies that help reduce portfolio risk. Their biggest problems have been dealing with the tidal wave of data and determining what data is worth using for evaluation purposes, but from what I’ve seen they’re starting to figure it out. Might seem arbitrary to drop some guy for his cluttered yard, but it’s so very not.
Just wait, without guaranteed rights to privacy it’s going to be a pretty massive tidal wave of “personalized insurance rates” based on a plethora of data people can’t quite conceive of at the moment.
But, hypothetically, if the insurance company did this ... it's not a privacy violation. Your "right to privacy" doesn't extend so far as to forbid your insurer from viewing your property.
We can all likely agree that trespassing physically on the property is not allowed.
But that's not what happened here. They were in airspace they were allowed to be in. They managed to view the property with equipment good enough to see what was in the area.
If you get high enough, you don't even need to go over the area itself. Hell, one of my neighbors has a house near enough my backyard that they can see clear over the fence from their upper floor.
I'd say it does, when they view parts of my property that I've walled off from ordinary view. It's reasonable to expect that photos of me won't be taken when I'm in my private backyard. My neighbors can't see into the yard. Pedestrians and motorists can't.
Yeah, random pilots flying overhead can look out their window and see me. But a targeted flight done for the purpose of photographing my private backyard (among other features) is a different scenario, IMO. I should be given a chance to deny this.
(Of course, maybe I already granted permission in Sec. II, Paragraph 34(c)(iii) of my insurance contract. I should read that.)
Nah, if someone is offering to pay you if your house burns down they're allowed to swing by your house and take a look at it.
For good reason.
So yes?
We could put it another way: police also ostensibly protect your property, should they also have unfettered access to it to ensure you're not doing anything that might increase the risk of intervention on your property?