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Should Smart Home Devices Talk to Your Insurance Company?

5.22.18 – Electronic House

The majority of homeowners like the idea, here are some smart home devices that can do the job.

Parks Associates research indicates that almost 60 percent of U.S. broadband households with insurance are likely to buy smart home devices with detection/prevention features and nearly 50 percent of U.S. broadband households with insurance are interested in having loss detection/prevention devices that communicate directly with their insurance company.

“Twenty to thirty percent of U.S. broadband households are very interested in receiving additional services from their insurance provider, depending on which service,” says Brad Russell, Director, Connected Home Research, Parks Associates. “Consumers appreciate the safety and security value propositions of smart home products, and these use cases align with their perceptions of the role of their insurance companies, which opens up many lucrative opportunities for new services and partnerships.”

Vastly more homeowners have installed home security systems than home water leak detection systems,” adds Bill Loesch, CEO, LeakSentinel. “Homeowners insurance covers financial losses from fire, theft, and water leaks, but fires and robberies threaten personal safety while water leaks do not. For leak detection systems to be more widely deployed, unlike home security systems, they must be financially attractive to both homeowners and insurers.”

Consider this statistic: For the period 2010 to 2014 the average water damage and freezing claim was $7,958 according to ISO, a Verisk Analytics business and the Insurance Information Institute. A water/freeze (most sensors monitor both) could potentially save big bucks, maybe even more in the form of discounts and if the sensor communicates directly with the insurance company.

Detector manufacturers appear to be on board, as well. Roost, for example, prominently lists on its website more than a dozen partnering insurance companies.

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