By Sarah Schlichter | Nerd Wallet
It’s a notice no homeowner wants to receive: your insurance company has decided not to renew your policy, effective 30 days. The reason? Based on aerial photos of your home, your roof is in poor condition.
Your first reaction might be outrage. Is your insurance company spying on you? Can it really take photos of your house at any time?
The practice is legal and, in some ways, nothing new, insurance experts say. Looking at aerial photos “is just another way of doing something that insurers have always done,” says Bob Passmore, vice president of personal lines at the American Property Casualty Insurance Association.
A home inspection is part of a process called underwriting, in which an insurer evaluates the likelihood that you will file a claim. In the past, many home insurance inspections were performed in person. Someone might drive by your house to take photos or come in for a thorough investigation.
Although these inspections still take place, many insurance companies rely on aerial images as a cheaper and more efficient way to view your property. But for homeowners shocked by a non-renewal, it can feel like a violation.
“Just because a technology opportunity exists doesn’t mean it can or should be used without safeguards and consumer protections,” says Doug Heller, insurance director at the Consumer Federation of America. “Using images collected without consumers’ knowledge, let alone their consent, is really problematic.”
How Insurers Use Aerial Images
Insurance companies study aerial photos looking for problems that could lead to future claims. Red flags may include:
- Debris in your yard. “This could be a home for vermin.” This could pose a trip and fall hazard,” says Karl Susman, owner of Susman Insurance Agency in Los Angeles.
- Trees weighing down your house. “It’s a horrible, horrible fire hazard,” Susman says. A tree could also crash into your house during a storm.
- Trampolines or swimming pools you have not spoken to the insurer about it. That could pose a prosecution risk, Passmore says.
But perhaps the biggest problem is the condition of your roof, says Alaina Hixson, director of sales and operations at Churchill Agency in Brentwood, Tennessee. Because roofs are weather damaged and expensive to replace, they are a major source of claims.
Insurers can check satellite images of your roof for moss, broken shingles or other signs of wear. Such issues could lead to a notice of non-renewal.
Why insurers abandon their policies
In recent years, insurance companies have become more demanding about the properties they cover. Insurers “want to keep their customers,” Passmore says, but “they also need to keep in mind what their risk exposure is.”
Currently, insurers’ financial risks are significant. In 2023, the United States experienced 28 disasters that each caused at least $1 billion in damage, according to the National Oceanic and Atmospheric Administration. Climate change is making hurricanes and wildfires worse, while inflation has increased the cost of rebuilding homes.
As a result, many home insurers have recently paid more in claims than in premiums. One way they’re trying to stem losses is by abandoning their riskiest policies — and aerial imagery can help them locate those homes.
What you can do
“If you receive a non-renewal notice, contact the insurer immediately and ask why,” says Heller. If the insurer used aerial footage, ask to see it and find out when it was taken.
Maybe the photos are from six months ago and feature an overhanging tree that you’ve since trimmed. “If you can prove through documentation that something is not what they think it is,” Hixson says, “an insurer will often work with you.”
Even if the problem in the photo is legitimate, an insurer may extend your policy if you fix the problem, Hixson says.
Unfortunately, not everyone has the budget for costly home repairs. If you cannot resolve the problem, look for new coverage immediately. Having a non-renewal in your insurance history can make it more difficult to find another policy, Hixson warns.
An independent insurance agent can help you shop around with other carriers. Keep in mind, however, that a new company’s home inspection may report the same problem as the old one.
If you think your insurer treated your non-renewal unfairly, file a complaint with your state’s insurance department, Passmore suggests.
Preventing insurance problems
You can’t stop an insurance company from taking aerial photos of your home, but you can make it more attractive to insure. “The first thing is maintaining your home,” says Passmore.
This includes clearing your yard of debris, trimming trees and monitoring the condition of your roof, Hixson says.
About two months before your annual policy renewal, Heller recommends getting quotes from a few other insurers. “Know what your options will be in case you find yourself in the middle of a non-renewal issue.”
The article Homeowners Insurance Companies Can Use Aerial Images to Drop Their Policies originally appeared on NerdWallet.
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