Property inspections represent an enormous underwriting expense for insurance companies, both at initial bind and with each renewal. With a goal to increase underwriting operational efficiency and reduce inspections expenditures, Florida Peninsula turned to CAPE Analytics and its advanced property intelligence technology for higher-quality condition assessments at a fraction of the cost of a physical inspection.
By leveraging geospatial imagery, computer vision, and machine learning, CAPE Analytics provides Florida Peninsula with instant, accurate property intelligence and a wide range of loss-predictive signals. For example, CAPE’s Roof Condition Rating detects issues such as missing shingles, the use of tarps, or discoloration—all of which can be verified with targeted, in-person inspections in instances when additional scrutiny is warranted.
"CAPE data was within our risk tolerance more than 95% of the time. There really was no comparison. And the currency of CAPE's data? Unbeatable."
Director of Underwriting, Florida Peninsula Insurance Company
What business challenge were you facing?
Like so many other carriers, Florida Peninsula tasked underwriting with reducing our annual inspection budget. Optimizing inspection spend is obviously important because it consumes such a significant amount of operating expenses. But when you’re talking about generating seven-figure savings, you need to think about innovation. Luckily, one of my roles—and one I really enjoy—is to bring innovation to the underwriting team.
What led you to decide imagery-based analytics were worth evaluating, despite your skepticism?
Fifteen years ago, people started saying, ‘Hey, we can get satellite photographs from Google.’ But the lack of current photography was a real problem. Today, plenty of solutions provide general property data. But one of the challenges that remained was a lack of visibility into the current condition of the home that can reduce the need for physical inspection. I’d been hearing a lot about CAPE and its advances in imagery-based analytics for roof condition data, so it was clearly worth evaluating. The roof is a reliable proxy for the condition of the structure below.
Your vendor evaluation process was quite rigorous. Why was that?
It had to be. I need to know which homes have eligible roofs at quote, which will require an inspection after bind, which ones we can wait on, and which ones should we inspect at renewal. Vendors were pitching all sorts of stuff—aerial, satellite, even drone imagery. We had each vendor provide condition analysis on the same properties. And then our team used our physical inspection to compare the accuracy of each. Most were fair. But I was blown away by the accuracy of CAPE’s analysis. Every property with a good roof condition rating from CAPE was within our risk tolerance more than 95% of the time. There really was no comparison, and the currency of CAPE’s data and its API response time was unbeatable.
12 months after integration, how is the solution performing?
It’s phenomenal. Our underwriting system receives CAPE data instantly, including their roof condition score. If the roof condition is poor or severe, but we see there was a permit pulled yesterday for a new roof, we make sure to inspect the home. But we can tell that some homes just fall outside our eligibility criteria right off the bat with condition issues that we might have missed otherwise. That’s a lot of risk not taken, and a whole lot of time and expense saved downstream on the part of my underwriting team. It creates a better customer experience for our agents.
How has CAPE been to work with?
That’s probably what has me speaking so highly of CAPE. They act as an extension of our team. They dive into my business and my objectives and are constantly thinking about ways that their solution can benefit my business even further. Very few vendors do that, but CAPE does. To me, it’s a great partnership.
How will you leverage the CAPE solution next?
Right now, a third of our book gets re-inspected every year on a rotating basis. With the size of our in-force book and the cost per physical inspection of around $35 that is a big expense item for us. Now, we’re going to use CAPE to monitor the whole renewal book and establish criteria for whether we do a physical inspection on a property based on the risk score generated by CAPE. That could easily lead to another 10,000 properties we don’t need to inspect each year—enabling us to enhance the quality and efficiency of our processes while saving a significant amount of money.