Loss Control Self-Surveys

Insurance and data have always gone hand in hand. The more a carrier knows and understands about a risk, the better they can price the protection they provide. The more an insured shares about their asset or need, the better solution can be provided. So why in this current state of data overload would a company decline to learn more about the risks they are insuring?

Our business is all about surveying and cataloging the assets and potential risks associated with a property. Majesco Loss Control facilitates millions of annual inspections, from single family homes to nuclear power plants. To my amazement, only a small percentage of those inspections are completed by the owner of those properties. These self-inspections are incredibly affordable since the property owner does most of the work and just completes templates provided by the carrier, snapping a few photos that are all illustrated in the platform. We have a customer who projects to save $1MM in expense for every 10% of inspections they can convert to self-administered. That is also a smaller customer, so imagine the impact on larger books.

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Insurance is highly regulated and rightly so. People spend a lot of money to protect their most valuable assets and their lives. That means state, federal, and a few professional organizations all have input and jurisdiction into how rates are set, and sales are made. To make a level playing field, carriers must be very specific about what risks they like and don’t like and what they are charging for the presence of these risks. They also have to very specific about the credits they provide to property owners for doing good things like risk management, installing IoT devices, predictive maintenance, and keeping their properties in good order. So given these restrictions, carriers may not be interested in all the additional data that might be available on a property. It's not tough to project the savings or loss minimization by finding the undisclosed trampoline, swimming pool, or pit bull.

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This is where opportunity knocks for the nimble. Homeowners and even many businesses are happy to complete a self-survey if it is easy and painless. Why schedule an appointment with an inspector and change your plans to be around when you have other things to do? Why pay an inspector to survey a property if the owner is willing to complete it on their own? Most carriers inspect 5-10% of their insured properties annually. Why not invite the other 90-95% to inspect their own locations? Nothing required but maybe you find out about 30% more of your portfolio for very minimal cost. Customers have shown a willingness to share if they think they may get a better deal or save money.

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For all the data out there, insurance seems to still be part science, part art or maybe luck. Carriers are fleeing CA for fear of wildfires and can’t get out of FL fast enough to beat the next hurricane. Even with the best data, losses still happen. Wouldn’t the best course of action be to collect every possible data point, make the most informed decision, and price accordingly? A well-kept property loaded with IoT devices to help detect and minimize risks certainly deserves a better rate than an overgrown property in obvious disrepair. Every property is insurable at the appropriate price. Why turn away the evidence to help you price accordingly?

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That’s my $0.02. What’s your thought? Comment below and explain why I’m right or wrong. Someone will profit by challenging the norm and the regulations to help write a comeback story.

#losscontrol #insurance #homeowners #iot #predictivemaintenance