Nationwide Q&A: IoT and smart home devices

A: I think the survey confirmed what we are experiencing with policyholders. There is awareness and adoption of smart home devices but a lot of people are more aware or interested in devices like cameras or ones that provide convenience or entertainment.

There is less awareness around water detection devices like water or sensors or valve shut-offs. This confirms that there is a need to increase awareness as the number one cause of non-weather-related claims is water.

I would highlight three key findings:

1. Consumers are open to smart home devices. Sixty-seven percent of respondents said they have at least one device in their homes.
   
2. Consumers think that the benefits of these devices are enough to overcome their privacy concerns. Although, 75% said they were at least somewhat concerned with privacy, roughly 60% perceived significant benefits around safety, protection and peace of mind. Sixty-four percent of respondents said they would consider smart home devices if they helped save on their insurance premiums.
   
3. There is a gap in consumer awareness around some devices. Many are not aware of evolving smart home technology that provides significant additional protections, particularly with water sensors and shut-offs. Only 7% of consumers surveyed indicated they have one of these devices in their homes, even though non-weather related water damage is a leading cause of claims.

A: Our goal in offering smart home solutions is to prevent small issues from becoming bigger ones. We want to create awareness around devices that will mitigate potential loss.

That’s what our partnership with Notion, a smart security system company, is about.

For policyholders, we offer a discounted rate for those Notion devices and an additional discount to homeowner or condo insurance premiums.

A: We believe smart home products are the future for smart home protection. There is a wide range of uses and devices and there is a lot of potential in that. Experts share that the market is poised for significant growth in the next few years.

Our immediate focus is around education. The number one cause of avoidable claims we see at Nationwide, for homeowners is from non-weather related water damage. Most of those claims come from pipe, fixture, or water heater leaks. The average water damage and freezing claim costs around $11,000, not to mention the hassle for the customer.

So, that has been an area of focus for us—increasing awareness of the issue and how smart home devices can help.