pwshub.com

Could You Be The Next Homeowner To Get Their Policy Dropped Due To Drone Surveillance?

Could You Be The Next Homeowner To Get Their Policy Dropped Due To Drone Surveillance?

Could You Be The Next Homeowner To Get Their Policy Dropped Due To Drone Surveillance?

Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below.

Home insurance is becoming more expensive and difficult to purchase nationwide, and now homeowners have a new concern: drone flights. As the cost of providing coverage continues to rise, insurers are taking more steps to limit their potential losses. One of those steps is using drones to inspect policyholders’ properties. This is leading to a rash of homeowners receiving cancellation notices due to drone footage.

Trending Now:

Imagine being a homeowner who has dutifully paid your premiums for decades and never filed a claim. You might think this would make you the perfect policyholder. Then one day, you go to the mailbox and find a cancellation notice from your home insurance company. What is more shocking than the cancellation itself is the grainy photo of your roof taken by a drone being cited as the reason for the cancellation.

This recently happened to Daytona Beach, Florida resident Mike Arman. He told the New York Post his policy was canceled after his insurance company flew a drone over his house and took photos that caused them to claim his roof looked "deteriorated." At least, that's the explanation Arman's insurance broker gave him, but Arman is still frustrated by the experience for several reasons.

First, Mike had been a policyholder in good standing for over 50 years. Second, he felt that the photo the drone took of his roof, which motivated the cancellation, was of low quality. He told the New York Post that the picture itself looked like it had been taken from a significant distance by a "far-off satellite." However, the real kicker for Mike Arman is that his roof was only six years old.

In most cases, the life span of roofs like the one Arman had installed on his home is between 20-30 years. Naturally, he figured there must have been some mistake, so he contacted his insurer and asked them to send someone out to evaluate his roof in person. After the insurance company told him they "didn't do house calls," Arman sent his insurance company documentation proving his roof's relatively young age.

Unfortunately for Arman, none of that mattered to his insurer, who carried through with their cancellation a few months later. The cancellation came at just about the most inopportune moment possible. Florida has been suffering through a full-scale insurance crisis, characterized by major insurers leaving the state and the remaining insurers raising premium prices at a near-geometric rate.

Keep Reading:

  • This billion-dollar fund has invested in the next big real estate boom, here's how you can join for $10.
    This is a paid advertisement. Carefully consider the investment objectives, risks, charges and expenses of the Fundrise Flagship Fund before investing. This and other information can be found in the Fund's prospectus. Read them carefully before investing.

  • Commercial real estate has historically outperformed the stock market. This platform allows accredited investors to invest in commercial real estate, invest today for a 1% boost.

It has left millions of Florida homeowners like Arman with no viable insurance option besides the state-sponsored Citizens Insurance Company. This time, Arman figured he would be proactive and hire an inspector to certify his roof. Despite receiving approval from his home inspector, Arman got another nasty surprise in the mail as soon as his Citizens policy came up for renewal.

It turns out Citizens uses drones to inspect homes too, and after a flyover at his home, they decided to increase his premiums by 25%. To insurance companies and their shareholders, this policy of inspecting homes via drone seems like good business. Drone technology allows them to "visit" more homes than they ever could in person, and with the increased cost of covering claims, proactively cutting risk allows them to continue functioning.

On the other hand, homeowners like Arman feel like their insurers are "spying" on them and that the cancellation process lacks any real transparency. Mark Friedlander of the Insurance Information Institute (an industry-funded think tank) disagrees. He told Realtor.com that aerial photography "is a much less intrusive way to inspect your home than sending an individual to your property," and he also believes it is more accurate.

Friedlander concludes that drones can sometimes make mistakes, but he says (without citing any data to back his conclusions up) that aerial surveillance is "10-20 times more accurate" than inspections done by human eyes. On the other hand, homeowners are shocked to find out that cancellations via aerial surveillance photos are even legal.

Albert Fox Cahn, who founded the Surveillance Technology Oversight Project, told the New York Post that "There's a need for updated insurance regulations. State law hasn't caught up with the technology." In the meantime, he recommends homeowners get proactive about removing potential hazards from their yards in preparation for drone surveillance. He said, "Don't wait until you get a letter saying that your policy won't be renewed."

You Can Profit From Real Estate Without Owning Property

The current high-interest-rate environment has created an incredible opportunity for income-seeking investors to earn massive yields and you don't have to own property to do it...

The Arrived Homes investment platform has created a Private Credit Fund, which provides access to a pool of short-term loans backed by residential real estate with a target 7% to 9% net annual yield paid to investors monthly. The best part? Unlike other private credit funds, this one has a minimum investment of only $100. 

Looking for fractional real estate investment opportunities? The Benzinga Real Estate Screener features the latest offerings.

This article Could You Be The Next Homeowner To Get Their Policy Dropped Due To Drone Surveillance? originally appeared on Benzinga.com

Source: finance.yahoo.com

Related stories
1 month ago - The numbers often differ on the size of the housing shortfall in the United States. Estimates tend to vary between 1.5 and 5.5 million units, and nearly everyone agrees we aren't building enough homes. The question of how to create more...
3 weeks ago - Big banks are getting more aggressive with their regulators in a highly charged election year — a sharp contrast to the harsh political scrutiny they received in the aftermath of the 2008 financial crisis.
3 weeks ago - Unfortunately, trading tips and investment advice come with a lot of the same jargon that make it easy to confuse the two if you’re not paying careful attention.
6 days ago - Suze Orman, the finance guru known for her sharp advice, has a bone to pick with home insurance companies. At 72, she's decided enough is enough for the wild costs of insuring her Florida beachfront condo – and she's speaking out. Don't...
1 month ago - Many moguls have made their millions (or billions) in real estate, but as much as the industry can create fabulous wealth, it can also go through...
Other stories
1 hour ago - YouTubers will soon be able to play with a host of new generative artificial intelligence-powered tools for creating content, including the ability to generate six-second YouTube Shorts clips, and backgrounds for their videos, using...
1 hour ago - Salesforce Inc. is making a major push to deploy AI agents on its CRM platform, an initiative the company views as the next step in enterprise artificial intelligence adoption. Building on its predictive Einstein platform for sales,...
1 hour ago - In a positive step forward and a possible sign of things to come, artificial intelligence video generation startup Runway AI Inc. has signed a deal with entertainment company Lions Gate Entertainment Corp. to explore the use of AI in...
1 hour ago - (Bloomberg) -- Asian equities braced for a tailwind from the Federal Reserve’s half-point rate cut and signs of further policy easing in the months ahead.Most Read from BloombergCalifornia’s Anti-Speeding Bill Can Be a Traffic Safety...
1 hour ago - (Bloomberg) -- US equities will climb through the rest of the year with the Federal Reserve’s aggressive interest-rate cut bolstering the chances of a soft landing for the economy, according to a survey of Bloomberg Terminal...