Smart technology has been around for years, but several challenges curbed mass adoption. For starters, Americans didn’t think they needed it. They thought smart tech was expensive, cumbersome to install and didn’t offer much value to their daily lives. While some of these feelings linger, the tide is starting to turn.
People are becoming more comfortable and, in some cases, more reliant on smart technology. By the end of 2016, there were more than 15 million smart homes in the United States. By 2021, media research group Kagan expects the number of American homes with smart technology to surpass 35 million.
Smart home devices offer more than just convenience. They can help homeowners increase energy efficiency and protect their homes.
Installing smart features can also lower insurance costs. There are several reasons why insurers want homeowners to invest in smart technology.
Insurance incentives for homeowners using smart tech
Some insurers reward homeowners with smart technology by reducing their premiums. Others subsidize the cost of these devices or pay to install them. From their perspective, smart home devices minimize damage and lower the number of claims policyholders file. They also lower a homeowner’s risk profile by detecting issues and making homes run more efficiently.
Smoke detectors, water monitors and alarm systems are among some of the most common smart features insurance companies want policyholders to purchase. Homeowners can also benefit from buying sensors that track weather conditions or devices that indicate whether a stove top is on or a door is unlocked.
Integrating technology into a new model
In addition to covering costs when trouble strikes, some insurance companies help homeowners prevent damage from occurring in the first place. Hippo, for example, offers new customers free cutting-edge sensors that detect water leaks. Other providers give away smoke detectors and different systems. Simple smart devices that warn of impending danger or destruction offer more comprehensive coverage and greater peace of mind.
Besides managing and mitigating risks, smart technology can help homeowners settle claims faster. Their features can help insurers seamlessly assess damage and decide what to cover.
Smart devices can strengthen the relationship insurance companies have with their customers, too. The data they provide can help insurers provide better products and services. With a deeper understanding of customers’ needs and habits, insurance providers can offer more personalized coverage and underwrite risk more accurately.
As fewer people file claims and the industry shifts, insurers will continue supporting the use of new technology designed to detect damage and prevent losses. They’ll play a proactive role in ensuring the safety of their customers’ homes as well. In an industry that hasn’t seen much change in decades, smart systems and features make insurers’ jobs easier and finally give them the opportunity to join the rest of us in the 21st century.
For consumers, finding the right homeowners insurance company will not only involve comparing the cost of coverage but also evaluating the perks insurers offer policyholders interested in smart technology.