Drones hold vast potential for streamlining and reducing the cost of insurance-related processes – from claims adjustment and risk-engineering to post-catastrophe claims settlements for customers and weeding out fraudulent agricultural claims.
Teaneck, NJ (Jan. 31, 2015) – Most of us have seen or read about the objects flying above soccer fields during the recent 2014 FIFA World Cup soccer matches. These unmanned aerial vehicles (UAVs), or drones, were deployed as a security measure to patrol the skies during the sporting event. Understandably, the technology has captured the imagination of a wide audience because of its ability to maneuver and easily carry out activities that were previously performed by humans.
Drones have actually been in service since the 19th century, and used for years by the armed forces for reconnaissance. However, they are soon expected to take center stage with the anticipated ruling from the Federal Aviation Administration (FAA) on the use of small unmanned aerial vehicles in U.S. skies.
The Association for Unmanned Vehicle Systems International predicts that within 10 years (from 2015 to 2025) drones will create approximately 100,000 new jobs and around US$82 billion(1) in economic activity. Equipped with new capabilities such as integrated audio and text with real-time video feeds and the ability to overlay images over existing footage through augmented reality, next-generation drones could have significant commercial value for businesses across industry segments.
Commercial and personal-lines insurers that cover property risks are likely to be early adopters of drone technology. For example, a property adjuster or risk engineer could use a drone to capture details of a location or building, and obtain useful insights during claims processing or risk assessments. Drones could also be deployed to enable faster and more effective resolution of claims during catastrophes.
While challenges on the regulatory front, privacy concerns and a lack of certain capabilities could stall widespread use of drones in the near future, once these obstacles are overcome, drones could have a significant impact on the P&C insurance industry.
In this white paper, we will discuss the rapid growth of drone technology, what it will take for drones to have real business impact, and how several industries are already experimenting with drones. We will also cite four realistic scenarios for employing drones in the insurance industry.
Read or download the white paper: “Drones: The Insurance Industry’s Next Game-Changer?” (PDF)
About the Authors
Agil Francis is a Director with Cognizant Business Consulting’s Insurance Practice. Agil has 10 years of management consulting experience in the insurance industry, where he has advised senior client executives on strategy, operations and technology issues across sales/marketing, distribution, underwriting and claims.
Gauthaman Krishnamurthy is a Manager with Cognizant Business Consulting’s Insurance Practice. Gauthaman specializes in the P&C industry and has nine years of business consulting and program management experience, during which he has advised clients on operations and technology issues across distribution, underwrit-ing and policy administration.
Aldrin Aloysius is a Senior Consultant with Cognizant Business Consulting’s Insurance Practice. He has eight years of business consulting and IT experience in the insurance industry. Aldrin specializes in P&C insurance.
1. “The Economic Impact of Unmanned Aircraft Systems Integration in the United States.” Association of Unmanned Vehicle Systems International. March, 2013.
About Cognizant’s Business Insurance Unit
Cognizant is a leading global services partner for the insurance industry. In fact, seven of the top 10 global insurers and 33 of the top 50 U.S. insurers benefit from our integrated services portfolio. We help our clients run better by driving greater efficiency and effectiveness, while simultaneously helping them run differently by innovating and transforming their businesses for the future. Cognizant redefines the way its clients operate — from increasing sales and marketing effectiveness, to driving process improvements and modernizing legacy systems, to sourcing business operations.
Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process outsourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered in Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 75 development and delivery centers worldwide and approximately 187,400 employees as of June 30, 2014, 2014 Cognizant is a member of the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the top performing and fastest growing companies in the world. Visit us online at www.cognizant.com.