When we think about the many gadgets in our homes, we probably don’t imagine them becoming smarter. However, as the Internet of Things (IoT) is harnessed and used for this technology, our home insurance premiums will be able to be worked out much more accurately.
How will they change our insurance premiums? Simple. Many of these smart devices have been designed to reduce risk at home. They can therefore reduce your premiums, since there’s less chance of an incident when the robots are making sure everything is ok throughout the house.
These devices will be connected to our smart devices, which will increase our quality of life and decrease the possibility of accidents. By 2020, we can expect to see around 50bn worth of connected devices around the world.
These include automatic A/C and heating, solar panels, smart security cameras connected to our iPhones so we can answer the door while away, smart fridges, and smart meters.
We can also expect big data to help companies make smarter decisions about risk and pricing. Basically, these companies will take the data collected from many different sources and use it to figure out their coverage and risk. This means that individuals who take greater responsibility (like using smart devices) will pay less than those that take less responsibility.
Monitoring systems are a great way to do this. Devices within our homes will be able to communicate with us through technology, and can send us alerts to our devices.
Consider this scenario. You’re cooking on the kitchen hob, and get a call. You’ve accidentally left some kitchen roll too close to the cooking and it catches on fire. That fire starts to spread, and as soon as you notice, you call the fire department. Unfortunately, your kitchen has already been damaged.
Now let’s look at how that scenario could be changed with a smart device.
You take a call, but you get an alert telling you that the hob is still on. You quickly head to the kitchen and turn the hob off, or turn it off via your phone, avoiding an expensive incident. Insurance companies are more likely to reward people who are using these smart devices as they will greatly reduce risk.
Monitoring systems could keep an eye on your whole home. If you’ve ever seen the damage done by a burst pipe, you’ll know that when it’s left for a long time the consequences can be extremely serious. If you were to get an alert the moment an issue happened, you could immediately take care of the problem and reduce the amount of damage.
Of course this technology is still relatively new, and therefore expensive. It would also need to be covered under your insurance. Check out AIG Ireland to learn more.
