October 22, 2016

NOTHING COSTS MORE THAN IT USED TO:

Why Insurance Companies Want to Subsidize Your Smart Home : Linking doorbells and thermostats to the Internet can cut the chance of expensive surprises. (Stacey Higginbotham,  October 12, 2016, MIT Technology Review)

Insurers such USAA and American Family have lately begun offering to strike a high-tech bargain: wire your home with Internet-connected devices such as a new thermostat, and get a discount on your home insurance policy in return.

Offers like that could speed up the adoption of smart gadgets, revamp the insurance business, and transform how we manage our homes. In the future, your insurer might call a plumber before a pipe bursts, for example. But the data needed to help prevent leaks or burglaries will also introduce new risks, such as vulnerabilities to data loss or ransomware.

Insurers across the U.S. are offering incentives to install one of half a dozen connected devices, ranging from moisture sensors to video doorbells. State Farm offers a discount on your home policy for installing a Canary home security monitor, for example. Liberty Mutual will send you a Nest Protect smoke detector, worth $99, free of charge and cut the cost of fire coverage. 

Some insurers want to go further. They think that urging us to wire our homes with Internet-connected devices will open up a flood of lucrative new data that can make their existing business of handling claims more efficient while creating a new relationship with the customer. With a feed of data from your home, an insurer could help you prioritize maintenance tasks and fix problems such as leaky pipes before they caused major damage.


And auto makers will have to insure their products once you aren't driving them--res ipsa loquitor.

Posted by at October 22, 2016 9:35 AM

  

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