Homeowners Keeping a 'Smart' Eye on Their Residences
Thursday, November 11th, 2021
Events over the past 18 months have kept homeowners at home more than ever before. With more employers embracing a "work from home" model, that trend is expected to continue – resulting in more wear and tear on the home's appliances and infrastructure. The added strain could lead to more of those systems failing, resulting in costly damage to the home.
Homeowners are turning to insurance-based smart home technology to monitor their homes and alert them if something goes wrong. A new Nationwide survey1 found that 66% of homeowners currently own at least one smart home device but many of them don't realize the devices they have could be saving them money on insurance premiums.
IoT devices popular with homeowners
Nationwide's Agency Forward survey found that 2 in 3 homeowners have already embraced smart home technology to reduce anxiety (42%) or make their homes more energy-efficient (33%). Devices most popular with homeowners are:
- video doorbells (59%),
- home security cameras (59%),
- smart thermostat (55%)
The use of this type of smart home technology is poised to grow exponentially with an estimated 25% increase in usage over the next five years2.
Leaving money on the table
Insurance-based smart home technology devices monitor hazards in the home and alert a homeowner when something goes wrong. Devices like doorbells, smoke detectors, thermostats, and water leak detectors keep a homeowner informed of what's going on in their house, even when they aren't in the home.
However, the survey found that only 7% of homeowners use smart sensors that monitor for water leaks, leaving their homes vulnerable to severe nonweather-related water damage. Only 27% stated knowing about sensors that monitor water flow and leaks, and less than a quarter (24%) are aware of sensors that can shut off the water in case of leaks. Not using these devices can leave their home vulnerable to costly water damage.
"The #1 cause of avoidable claims for Nationwide homeowners insurance policyholders is nonweather related water loss, with most of those claims coming from pipe, fixture, or water heater leaks," said Beth Riczko, president of personal lines at Nationwide. "With the Insurance Information Institute reporting the average water damage and freezing event causes more than $11,000 in damage, homeowners should consider these types of sensors to provide an extra layer of protection.3"
Technology benefits can ease concerns
While costly price tags (47%), lack of knowledge on smart home technology (32%), and security concerns (29%) are keeping homeowners from owning smart home technology, 64% of them said they would be interested in using them if it helped reduce their premiums.
"Participating in Nationwide's smart home program saves policyholders about 4% on their homeowners insurance premiums, but the savings are even greater when you consider the additional benefits of having a smart home device," said Riczko. "Alleviating the stress of having to get major damage fixed, reducing repair times, easing the anxiety you feel every time you leave the house—that kind of peace of mind is priceless."
Nationwide partnered with Notion in 2020 to offer smart home monitoring technology to provide this added layer of protection. The home monitoring system packs multiple capabilities into each sensor, which monitors the home for open doors and windows, smoke/CO2 alarms, and water leaks - all from a personal device. The program is offered in 13 states and will expand to more states in 2022. Talk to your insurance agent to see if you can benefit from having smart home devices in your home.
Learn more about Nationwide's current smart home program and talk to your agent to see if you can benefit from having smart home devices in your home.
Smart home is available in AL, AZ, CA, CT, DC, IA, IL, MS, OH, TX, VA, VT & WA, with additional states to be added in the months ahead.