New research by Parks Associates shows that 40-50% of consumers with either homeowners or renters insurance are interested in receiving additional services, such as restoration and maintenance services, from their insurance provider. Insurance Opportunities in the Connected Home explores the convergence of smart home technologies and insurance services as a way to generate new revenue, reduce claims, and deepen customer engagement.
“Forty percent of U.S. broadband households indicate intentions to buy a smart home device in 2018, and a key way to turn purchase intention into reality is to offer valuable incentives,” said Brad Russell, Research Director, Connected Home, Parks Associates. “Among these likely buyers, roughly 75% are interested in a feature that automatically notifies their insurer in the case of damage or a claim. Communication with insurance companies is clearly valued among smart home shoppers.”
Consumers likely to purchase smart home products are also considerably more interested in receiving additional services, including restoration services after damage has occurred. The research firm notes that consumers looking to purchase smart home devices are generally more comfortable with data sharing and likely to recognize the value in data analytics in simplifying and expediting claims processes. Further automation can also relieve consumers of some notification responsibilities in exchange for receiving discounts.
“There are multiple go-to-market strategies for ‘insurtech’ solutions, from OEM and platform partnerships to device rebates, premium discount incentives, and free devices,” Russell said. “These arrangements have significant benefits to insurers as well, from competitive differentiation to expanded service offerings. The race now for both OEMs and insurers is to develop smart home solutions that can manage the data needs within this industry.”
Insurance Opportunities in the Connected Home assesses consumer interest in using smart home products in connection with insurance services. It evaluates the potential for insurance providers to become a channel for smart products, provides a profile of likely buyers of smart home products from their insurers, and tests interest in device bundle and financing options. Additional findings include:
- Roughly 60% of consumers with homeowners or renters insurance are likely to purchase a smart home product that can detect, notify of, or prevent damage or loss in at least one scenario tested.
- Nearly 40% of consumers with insurance would switch insurance providers to obtain smart home products.
- 20-30% of consumers with insurance are likely to purchase a fire safety package for an up-front cost of $200-$400.