American International Group Inc (NYSE: AIG)
Amazon, Inc. (NASDAQ: AMZN)
It seems the insurance industry is stealing a page from e-commerce’s playbook. Insurance giant AIG recently announced it has received permission from the Federal Aviation Authority (FAA) to use drones. In what could be a Domino effect from the FAA granting Amazon license to begin testing drones to assist in delivery, AIG has found that drones can be used in situations other than commerce.
Insurance industry exciting?
“I’ve never been as excited about the insurance industry as I am now,” said Andrew Maximow, director of client services at the drone maker 3D Robotics, in an interview with the Verge. And why shouldn’t he be? This is just the beginning of what could be a massive innovation in the insurance industry.
In AIG’s announcement, it explained it would be using the drones to help assess the damage of roofs and weak structures after storms and/or natural disasters, thereby protecting their insurance inspectors from a dangerous environment. But not only does it keep insurance inspectors out of danger, it will likely also a) take a lot less time to do an inspection and b) decrease the need for inspectors, thus saving costs for the company.
AIG put it that way in its press release, at least:
“UAVs can help accelerate surveys of disaster areas with high-resolution images for faster claims handling, risk assessment, and payments. They can also quickly and safely reach areas that could be dangerous or inaccessible for manual inspection, and they provide richer information about properties, structures, and claim events. The exemption also permits AIG to implement a robust research and development program to explore new and innovative ways to employ UAVs in support of the needs of its customers.” (Emphasis added)
Now let’s talk about that last portion. According to AIG, it also has license from the FAA to explore other ways to use drones to improve the customer experience. I’m not exactly sure what they could entail, but suffice it to say AIG is likely pouring a lot of resources into leading the insurance industry into a new age of technology.
Chief technology officer
To add to the concept of maximizing technology to innovate, AIG also announced it was creating the role of Chief Technology Officer in another attempt to modernize the company. This is a huge step for new CEO Peter Hancock, who took over for Robert Benmosche after the latter brought AIG out of the financial crisis.
There was a lot of speculation at the time whether Hancock would be able to fill Benmosche’s shoes, but it looks like he’s filling them quite nicely. Michael Brady, the newly appointed CTO, will first focus on improving the productivity of AIG’s workforce and to make sure there are as few technological obstacles as possible. That alone should make investors happy.
AIG is the largest insurer in the US and Canada, so you wouldn’t think it would be at the forefront of technological innovation. Yet that’s exactly the case. This presumably slow-moving giant is, as Mr. Maximow said it, making the insurance industry exciting again.