Use of aerial imagery in decision making

[LOGO] KAY IVEY GOVERNOR MARK FOWLER COMMISSIONER STATE OF ALABAMA DEPARTMENT OF INSURANCE 201 MONROE STREET, SUITE 502 POST OFFICE BOX 303351 MONTGOMERY, ALABAMA 36130-3351 TELEPHONE: (334) 269-3550 FACSIMILE: (334) 241-4192 INTERNET: www.aldoi.gov DEPUTY COMMISSIONERS JIMMY W. GUNN LARRY CHAPMAN RICHARD FIORE CHIEF EXAMINER SHEILA TRAVIS STATE FIRE MARSHAL SCOTT F. PILGREEN GENERAL COUNSEL REYN NORMAN # Bulletin 2025-03 TO: All insurers writing homeowner and commercial property and casualty insurance in Alabama FROM: Mark Fowler Commissioner of Insurance Mark Fowler DATE: June 17, 2025 RE: Use of aerial imagery in decision making EFFECTIVE: Immediate The following applies to consumer and commercial risks. As used in this Bulletin, "aerial imagery" refers to photographs, videos, or other visual data captured using satellites, aircraft, drones, or other aerial platforms. When used appropriately, aerial imagery can expedite claims handling and provide a safe way of making evaluations of property conditions. It may be especially useful during catastrophic weather events and when claims adjusters are unable to safely reach areas impacted or destroyed by severe weather. While aerial imagery can provide benefits when used appropriately, its misuse can result in inaccurate decisions and confusion. For example, aerial imagery can be misused if an insurer relies upon aerial images that are vague, not recent, show the wrong structure or property, or do not clearly show damage or disrepair. Accordingly, insurers are reminded that they should use due diligence when utilizing aerial imagery and ensure that any action taken is based on accurate information. Specifically, insurers should be cognizant of the following when using aerial imagery for non-renewals, cancellations, underwriting, claims handling, and similar activities: 1. If possible, aerial imagery should not be the only information utilized in decision-making. For example, blurry or older images that appear to show staining or discoloration of shingles will usually not be sufficient, standing alone, to prove that a roof must be replaced. If an insurer's review of aerial imagery leads to concerns, the insurer should work to obtain recent, clear information, through a physical inspection or otherwise, to establish whether there is an Alabama Department of Insurance Established 1897 Bulletin 2025-03 June 17, 2025 Page 2 issue with the condition of a property that is substantial enough to determine the insurability of the property. 2. If an insurer uses aerial imagery as a basis for non-renewal, it is best practice to notify the affected property owner before initiating the non-renewal action, advise the owner that the non-renewal action is being taken based upon aerial imagery, provide the owner with copies of any aerial images used in taking the action, and allow the owner to provide updated information or dispute the accuracy of the aerial imagery used. If an affected property owner files a complaint with the Alabama Department of Insurance, that complainant will be entitled to view evidence relied upon by the insurer in making the nonrenewal or cancellation determination. Many complaints to the Department of Insurance stem from a lack of communication. The Department believes that some of these complaints can be resolved or avoided when insurers communicate clearly with affected property owners, those owners are given an opportunity to review evidence relied upon by the insurer, and the owners have reasonable opportunity to provide responsive information. Insurers are encouraged to issue loss control recommendations and provide affected owners with reasonable time to make needed repairs before taking other action, such as non-renewal. 3. As noted, older aerial imagery may not accurately portray the current condition of property. When initiating a non-renewal action based upon aerial imagery, insurers should be utilizing recent, accurate imagery. The burden is on the insurer to prove the reason for non-renewal. If a change to the insurability of the property is asserted as a reason for non-renewal, recent evidence will be required to meet this burden of proof. Older aerial imagery standing alone may not be sufficient to meet this burden. 4. Use of aerial imagery should comply with any applicable Federal, State, or county and municipality requirements. Please email any questions regarding this Bulletin to: rates.forms@insurance.alabama.gov MF/JFM/ct