Bringing the Power of Smart Monitoring Technology to Insurance
IoT (Internet of Things) technology isn’t new – in fact, you could argue that it’s been around since the early-1990s when John Romkey and Simon Hackett created a toaster that could be connected to and controlled from the Internet!
The technology that powers IoT devices has, however, improved a lot since then, and so has the range of products available to consumers. Today, everything from appliances to light bulbs and home entertainment can be controlled with a smartphone or virtual assistant.
But one of the fastest-growing segments in IoT technology is home monitoring.
To put it in numbers, by 2023, home monitoring and security systems are predicted to have a 22.6% share of the smart home market, second only to video entertainment and smart speakers.
So what explains the growing popularity of smart home monitoring? Why is everyone suddenly installing devices to monitor their homes remotely?
Well, put simply: because it works.
Smart home monitoring tools, like Notion’s multifunctional sensors, have a real and direct impact on keeping your home and family safe from potential threats.
Take water damage, for example. When a homeowner installs Notion Sensors near potential accident areas in their home (by toilets, sinks, bathtubs, water heaters, AC units, and other appliances), Notion will send them a smartphone notification if a water leak is ever detected. That way, they can address the issue before it becomes a costly problem (and without ever having to make a water damage claim!).
The same is true for sounding alarms – Notion Sensors installed near UL-listed smoke and CO alarms will send homeowners an alert when the alarm sounds so they can take immediate action – temperature changes, open doors, and more.
For us, it’s about empowering home and property owners to be proactive in monitoring their spaces and most valued possessions.
Just as IoT technology improves monitoring within the home, it also enables insurance companies to understand their customers in ways they couldn’t before and determine risks more precisely.
Home insurers, for example, have historically relied on user-reported data to calculate risks and determine prices. But now, with the data collected through IoT programs, insurers can quantify (and therefore mitigate) risk where it previously wasn’t possible while minimizing loss claims.
In fact, according to a recent McKinsey report, automation through smart home devices can cut the cost of the claims process by as much as 30%. And in many cases, those savings can be passed on to customers.
This is precisely why so many insurance companies are now partnering with smart home companies like Notion to offer bundled incentives – it’s a win-win for both parties. Using our example from above, an insurer could set up an IoT program where customers who have filed water-related claims in the past are sent a free Notion Sensor for their home. This, in turn, can help reduce future claims and associated risks for a homeowner.
Of course, this is just one example of how IoT technology is helping re-shape the insurance industry. The reality is that nearly all aspects of home insurance are being impacted by the growing influence of IoT, from increased customer engagement to new revenue streams and education.
A great example is customer acquisition. While the Internet has, of course, changed how people shop for insurance, agents are still the primary sales channel for most insurers. But with increased competition and an influx of new, technology-savvy players, getting customers to pick your insurance offering over someone else’s isn’t as easy as it used to be.
That’s why some insurers are now bundling their products with smart home monitoring systems – it’s a great way to attract customers because they understand the value of smart home technology.
The same is true for customer engagement. Today’s digitally native consumers expect higher levels of service and engagement, yet most policyholders only interact with their insurer when they file a claim or during policy renewal.
By setting up an IoT program, insurers can act as advisors to their customers and help them protect their property through value-add touchpoints and co-branded communications with a partner like Notion. This, in turn, can help improve insurers’ brand perception and drive even more long-term growth.
Taking all of this into account, it’s not surprising 84% of insurance adopters say their core business strategy has changed because of IoT.
Setting up an IoT program
If the above wasn’t enough to convince you of the benefits of IoT programs, here’s one more: they’re extremely easy to set up.
For example, an insurer could simply offer their policyholders a discount on smart home products that help property owners track real-time instances of water leaks or sounding CO2 alarms through their mobile devices and enjoy savings on their homeowners’ insurance policy.
Or they could implement more integrated IoT programs, such as ones that have a co-branded experience, lower deductible options, or rewards for reducing risk.
If you’re looking for a partner for your own integrated smart home program, we’d be happy to help.
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