WATCH NOW: “How the Internet of Things is Remaking Homeowners Insurance”
With every new device adopted, the opportunity for insurance carriers in the smart home grows. Today, one-third of U.S households are connected and we are expected to reach 55% in the next 3 years. Greg Katai, VP of Strategic Partnerships at Yonomi, discusses how these opportunities could transform traditional insurance models in the future on a panel hosted by AM Best’s, John Weber.
The connected home market has highlighted a clear roadmap for insurance applications where carriers avoid loss and help their customers build safer homes. The opportunity for insurance companies, however, is beyond the reach of traditional insurance models.
Entering the connected home market for insurance companies is complicated, to say the least. There are many challenges that lie ahead for providers and among the most paralyzing, according to the panel, is managing connected hardware and their device ecosystems across millions of homes.
For example, there are early proof points that leak detectors work for insurance applications and the ability to automate devices together impacts even more use cases. Insurance providers have to choose which devices to support and to what extent. The devices themselves must reliably transfer the necessary streams of data for insurance companies to validate discounts and claims.
By entering consumer IoT and the connected home, insurance companies are charging a transformative path for their business models.
Despite these challenges, insurers agree that they must find the sweet spot between complexity and price. A real opportunity exists for providers to be left behind waiting for the ideal moment as traditional models are challenged by InsureTech startups and other non traditional players.
“If we sit here 5 or 10 years from now and all we have done with IoT is delivered 5 to 10% in discounts on home insurance for our customers, then we might have a problem”, says Dan Davis, Director of Emerging Markets at LexisNexis Risk Solutions.
Providers should leverage IoT ecosystem partners who can accelerate learning. Companies who are actively learning and building partnerships will be the ones who ultimately take the lead.
By changing the way insurance companies think about traditional data streams, providers can begin to uncover reliable and creative solutions from which both insurance companies and consumers can benefit. The opportunity for insurance companies to enter the smart home is here, it’s now, as Greg says, “these technologies are here and here to stay, we are only beginning to scratch the surface”.
Watch the full panel below.
Full Panel: “How the Internet of Things is Remaking Homeowners Insurance”
About the Panelists
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