January 17, 2017 by Canadian Underwriter
Two out of three homeowners insurance customers in the United States would be willing to change insurance companies to get policy discounts for using smart home devices, according to new research findings released on Tuesday by NTT DATA.
“Our study found that there is a large distinct group of homeowners insurance customers – 64% of survey respondents – who are willing to invest in smart home technology,” said Normand Lepine, senior practice lead, insurance data and analytics for NTT DATA, in a press release. “However, these ‘seekers’ are less loyal to their current carrier. Seekers are the most important customer segment for insurers to pay attention to as they pose both a sizable opportunity for growth and a potential risk for disruption.”
The results are from a survey last October of slightly more than 1,000 U.S. consumers and over 100 U.S. insurers online. NTT DATA, a global business and IT services provider in more than 50 countries, surveyed consumers opinions on changing insurers for discounts on smart home devices, including smart thermostats, smoke/carbon monoxide (CO) detectors and garage door openers.
Among the study findings:
“Uncertainty creates an opportunity for disruption,” the release said. “The role insurers will play in the IoT ecosystem and how they will gain access to the data from customers’ smart home devices is yet to be determined.”
The study also found that competitor segments that insurers believe are best positioned to be major players in the evolving smart home ecosystem include: major technology firms (Google, Apple and Samsung) – 72%; home appliance manufacturers (50%); telecommunication firms (36%); insurtech companies (37%); insurers (25%); and utilities/cable (19%).
“The IoT ecosystem is disrupting the insurance industry, inviting new competitors, potential partners and changing how products and services can be delivered,” Lepine said in the release. “Accessing the data that comes from smart home devices and being ready to leverage it will be key to carrier success. NTT DATA recommends insurance companies prioritize the development of partnerships with the smart home gateway firms who will control the flow of this data.”