The Rise of DIY Home Inspections in Insurance
The insurance industry is witnessing a significant shift in how home inspections are conducted, with DIY systems becoming increasingly popular among prospective insureds across the United States. According to Craig Locante, head of survey business for EXL Survey and Business Control, “Do-it-yourself inspections are here! It’s not a matter of ‘if,’ but ‘How can I implement it?'” Speaking at the recent Insurance Innovators USA conference in Nashville, Locante highlighted the growing trend of using mobile apps for pre-policy property surveys.
EXL has partnered with TruePic to develop software that enables homeowners to conduct their own property inspections using smartphones. The process begins with the insurance carrier sending a link to the policyholder via email or text message. The homeowner then answers a series of survey questions and takes photographs of the property, both inside and out. TruePic’s artificial intelligence (AI) software verifies the authenticity of these images, detecting any attempts to submit fake or misleading photos.
Craig Stack, co-founder and president of TruePic, explained that the AI can identify if an image is “a picture of a picture” or if it includes irrelevant elements like a neighbor’s property. The technology also checks for location metadata to ensure the photos were taken at the policyholder’s address. While some homeowners might initially be hesitant to share photos of existing damages, Locante noted that most are willing to participate, especially when they understand that the DIY approach avoids the cost and intrusion of a physical inspection.
The benefits of DIY inspections are twofold. For homeowners, it offers convenience and avoids the disruption caused by physical inspections. For insurance carriers, it provides a more accurate assessment of property values and potential risks. Locante revealed that in 65,000 DIY inspections conducted for three large carriers over the past 12 months, the EXL/TruePic approach identified an average underinsured value of $245,000 per home. This resulted in an additional $598 in premium per policy and a total of $40 million in additional premium in the first year.
Lessons Learned and Industry Impact
The shift towards DIY inspections gained momentum during the COVID-19 pandemic and has continued to grow since then. An estimated 60% of insurance-required home inspections in the U.S. are now conducted using DIY methods. Industry leaders have learned valuable lessons along the way, particularly the importance of customer satisfaction and simplifying the inspection process.
Locante emphasized that traditional on-site surveys often include over 50 data points, which is impractical for DIY inspections. Instead, EXL has focused on key questions such as the age of the roof, whether a business is operated from the property, and if it’s a primary or secondary home. Homeowners are then asked to take a reasonable number of photographs, which, along with their answers, are reviewed by underwriters to assess risk and replacement costs.
The use of generative AI assists underwriters in rapidly producing concise property reports. Other companies offering DIY inspection apps include Tap Inspect, myInspections, Flyreel, and Spectora, among others. As the insurance industry continues to adopt this technology, it’s clear that DIY home inspections are becoming an integral part of the property insurance landscape.
Conclusion
The rise of DIY home inspections represents a significant shift in how insurance companies assess property risks and values. With the help of AI-powered verification and streamlined survey processes, this approach is not only more convenient for homeowners but also provides insurers with more accurate data. As the industry continues to refine these systems, we can expect to see further improvements in how property insurance is underwritten and managed.
