What Drivers Need to Know About Flock Cameras and Car Insurance

Flock cameras are a type of AI-powered surveillance camera referred to as automated license plate readers (ALPR). They are produced by Flock Safety, one of the major providers of ALPR systems in the U.S. Other companies in the vehicle-location and ALPR space include Motorola Solutions and its Digital Recognition Network (DRN).

AI powered cameras collect vehicle data that can influence insurance risk assessment and claims processing.

One of the most notable recent connections between Flock cameras and auto insurance comes from Texas, where an insurance-related fee introduced in 2023 has helped fund the installation of over 3,000 Flock cameras across the state.¹

The fee was created to help combat vehicle-related crimes such as catalytic converter theft, rather than specifically to fund surveillance cameras. However, its use to fund Flock cameras illustrates an unexpected connection between auto insurance and the growing use of ALPRs.

That said, paying an insurance-related fee that helps fund Flock cameras is not the same as having your individual insurance rate determined by Flock camera data. There is currently no clear evidence that insurers use Flock data specifically to set individual premiums, which is likely due to the fact that it’s not necessarily readily available to insurers.

Other ALPR companies have a more direct relationship with the insurance industry. DRN, for example, markets vehicle-location and other data services to insurers that can be used to help assess risk and investigate potential fraud.² Depending on how the information is used, it may also factor into underwriting or policy pricing.

AI-powered cameras and ALPR systems can also provide information that insurers use to investigate claims and verify vehicle details. The extent to which insurers can access or use this information varies depending on the system and the data available to them.

Monitoring garaging address

Insurers use location data to verify if a vehicle is parked where the policyholder claims.

One of DRN’s advertised services is Garage Aware, which allows users to identify locations where a specific vehicle appears to be regularly garaged and potentially identify discrepancies with the address reported by a policyholder.³ This may include a vehicle being regularly garaged in an area with higher insurance rates without disclosing it.

DRN says this information can be checked even before a policy is issued if the insurance company submits the customer’s VIN or license plate to DRN for verification. The company also suggests that insurers make this a regular part of their process before renewing policies.

The information can give insurers another way to verify details provided by policyholders and identify potential underwriting or fraud concerns. However, drivers should be aware of what information and data insurers can obtain, how it is collected, and how it may be used when evaluating an insurance policy.

Detecting commercial use

Garaging patterns, in addition to photographs captured by AI-powered cameras, can also help identify when a vehicle is being used for unauthorized commercial purposes. For example, DRN photos can show if vehicles have signage, ladders, trailers, or other identifiers that may indicate the vehicle is being used commercially, which requires a commercial policy.

Its Radius Response product also uses license plate data to check if a vehicle is regularly operating outside its designated radius, which presents a risk to insurers. This information can help insurers generate more accurate quotes, inform policy renewal decisions, and identify policyholders who may be misrepresenting where their vehicles are primarily driven to obtain lower premiums.

Assisting claims processing

Insurance companies use vehicle photo data and location information to verify claims and investigate potential fraud.

The photos of vehicles detected by DRN cameras can also be used in claims investigations, along with vehicle location data. Insurance companies may use this information to verify a vehicle’s location around the time of an accident or other covered event and compare it with the details provided in a claim.

Photo evidence may also help insurers verify the condition of a vehicle before the reported damage occurred, potentially making it easier to identify inconsistencies or investigate suspected fraud. In addition, license plate and address searches using ALPR data can help investigators identify vehicles that appear in multiple claims or may be linked to other vehicles, people, or locations relevant to an investigation.

Investigating vehicle theft

Stolen vehicle claims are perhaps one of the most obvious use cases for ALPR technology. For example, DRN can provide alerts to insurers when a flagged license plate is detected within a specified coverage area. This information can help law enforcement with vehicle recovery efforts and may also help insurers investigate and resolve theft claims more efficiently.

ALPR data may also be useful if a stolen vehicle is recovered. Photos and location records can provide insurers with additional information about where and when the vehicle was detected after the theft was reported, as well as any damage incurred, which can help with the subsequent claims investigation.

DRN notes that its vehicle location and photographic data can be used as “an irrefutable record of where a vehicle has been sighted.”⁴ However, a camera detection does not necessarily establish what happened or who was responsible for an incident, and both the technology and the people interpreting its data can make mistakes. The Institute for Justice has recorded at least 27 cases since 2018 in which ALPR cameras misread license plates and contributed to wrongful law enforcement actions.⁵

The consequences of an inaccurate ALPR record may be different in an insurance investigation than in a law enforcement encounter, but the same limitations are relevant as insurers and other organizations increasingly rely on AI-powered cameras and vehicle-location data. Questions about oversight and regulation are likely to remain part of the broader discussion as consumers and legislators call for additional safeguards.⁶

AI-powered cameras and ALPR systems are frequently making headlines due to their increasing use by law enforcement and the privacy concerns they raise, despite also presenting potential benefits. They are also becoming increasingly connected to the auto insurance industry, from helping insurers verify garaging addresses and identify potential commercial use to investigating claims and recovering stolen vehicles.

While Flock cameras currently have more limited use cases in insurance due to their data use model, other vehicle-data companies such as DRN market ALPR data directly to insurers for underwriting, renewals, and fraud investigations. As these technologies become more widely used, the accuracy of the data, how insurers use it, and the safeguards surrounding it will remain important considerations for policyholders.