Do you remember The Jetsons? If so, here’s a pop fact that will surely blow your mind: right now, in 2020, we are closer to the year in which the popular show is set (2062) than we are to when it first premiered on television (1962). Those of us who grew up watching this show were entertained by the future prospect of flying cars and robot housekeepers. And while we still have 42 years to make the dream of flying cars for everyone come true, we’re already seeing household appliances that can be operated by voice or via a phone app. The smart home of the future is already here.
The Internet of Things (IoT) is fueling a growing appetite for smart devices to help us manage our daily lives, and nowhere is it more evident than in our homes. These devices are generating massive amounts of data, which in turn creates new strategies for home insurance carriers to not only engage with their customers, but also use the data to unleash new business opportunities.
Insights from Smart Home Research
LexisNexis® Risk Solutions commissioned a study of 2,500 U.S. consumers to take a closer look at these opportunities. The survey asked about smart home device adoption, smart home insurance program awareness, program engagement incentives and data sharing. We focused the survey on nine smart home devices including thermostats, lightbulbs, doorbells, door locks, security systems, and others. Close to half of the respondents own at least one device from one or more of the device categories we studied and several own many.
Below I cover a few highlights from the study, now available in our new research report, Insights and Strategies for Smart Home Insurance Programs.
Insurance Discounts are Motivators
- Homeowners who currently own smart home devices are more willing to purchase or install additional devices if their carrier offers them a discount on their home insurance policy.
- If they are offered a discount on their premiums, many smart home device owners are also willing to share data with their carrier for underwriting and policy pricing purposes.
Consumers are buying devices for many reasons
- Consumers who own one device often own multiple devices.
- Utility devices such as smart thermostats and lightbulbs are a popular choice, as are smart security devices.
Security vs. Cost
- Almost half of survey respondents name safety and security as their primary reason for purchasing a smart home device or system.
- Of those respondents who do not own a smart home device, more than half say that cost is a deterrence.
Carriers Have Work to Do
- Consumer awareness of smart home insurance programs is low. More than three-quarters of the survey’s respondents were unaware of incentives or discounts available for installing smart home devices.
- Discount program awareness is higher among smart home device owners who have filed a claim within the last five years.
The results of the survey indicate that with the right strategies, consumers and carriers can benefit from timely, actionable, smart home data-driven insights. Smart home device adoption is growing, and that creates an opportunity for carriers to introduce smart home insurance programs to their policyholders and prospects, and drive engagement, loyalty and retention.
For more insights, download our new research report Insights and Strategies for Smart Home Insurance Programs.