Homeowners insurance helps protect one of your most important (and expensive) investments, but here’s the rub: you can benefit from it only after disaster strikes. If a tree in your yard falls on your roof or a pipe in your basement explodes, you get a payout from your insurance company and use it to help cover the cost of repairing your home. But given the inconvenience of having a 100-year-old oak limb dividing your living room or having to put on a wetsuit to go down to the basement, most homeowners would rather not go through the hassle of filing a claim, getting estimates and volleying back and forth with their insurance agent on a fair payout.
That desire actually dovetails with homeowners insurance companies' preference to avoid paying for pricey claims, and now technology is giving all parties involved a chance to turn their dreams into reality. The nascent "internet of things," where devices and sensors around the house communicate with each other to help put a halt to avoidable catastrophes is now being championed by some insurance companies that offer discounts on policies or other subsides for policyholders who opt to install devices in their home.
The latest addition to this club is Hippo Insurance, which announced on Sept. 20 its partnership with home-monitoring sensor company Notion. If new Hippo customers in qualifying states install a complimentary Notion Smart Home Starter Kit (which consists of two sensors and a dedicated router for those sensors), they receive an average discount of 5 to 8% (depending on the individual policy). With the average Hippo policy costing $1,100 a year, that's as much as an $88 refund back in the pocket of the customer. "By installing this device, you benefit by preventing [damage to your house] and from a lower price," said Assaf Wand, CEO and co-founder at Hippo Insurance.
Homeowners insurance is a highly regulated industry at the state level, which is why the offer is only valid in certain locations. The states where both new and existing Hippo customers can currently take advantage of its partnership with Notion are:
Installing the sensors, which can be set to detect everything from fluctuations in room temperature to water leaks to open doors or windows, takes as little as 15 minutes. Once set up, the system will send a push alert to users’ phones if any of the measured metrics stray from the boundaries programmed by the user. That means homeowners can find out about small leaks or opened windows before it leads to a disaster.
Other insurance companies have seen the advantage in helping pay for an ounce of prevention rather than an expensive and costly pound of cure. Examples include—
|Insurance Company||Smart Home Device||Discount to Policyholder|
|Erie Insurance||Roost Smart Water and Freeze Detector||Participants receive the detector, valued at $90, for free.|
|American Family||Frontpoint Wireless Security System||Participants receive a security system, valued at $600, for $100. Plus an unspecified discount on your homeowners policy. You must contact an insurance agent for more details on the discounted policy.|
|State Farm||Canary Home Monitoring System||$20 Visa gift card and save $20 on a Canary Annual Membership if you upgrade; homeowners receive a discount up to 2% on their policies, while renters quality for discounts of up to 7%.|
|Liberty Mutual||Nest Protect smoke detector||Participants receive a free Nest Protect, valued at $99, free of charge. Homeowners also receive a 5% discount on home insurance policies and a 20% discount off the fire portion of the premium.|