Plymouth Rock Home Assurance CEO, president: Focused on digital customer experience

It's a big part of it. I think it's proof that if you use technology for the consumer benefit, … when you do something that makes their lives easier and quicker, and gives them a lot more options a lot more easily, then I think you can attract people who aren't motivated 100% by savings. They're willing to spend an extra $5 to have a faster, easier process and maybe they'll spend more than that if there's coverage that they're willing to buy from a carrier they trust and it's easy. 

When we initially brought our product out, we built around the experience of buying our product, meaning that we designed the work that gets done in the background, to make it easy to be onboarded with quote and bind. So, we introduced several technologies that made it very easy for a customer to get at our rate after the point of sale. Since then, we've added a lot of tech to allow customers to make, I'd say somewhere in the range of 70%, of changes on their own.

About six to eight years ago, there was a large amount of smart home providers trying to integrate with insurers on the promise that it could make the home more safe, have fewer losses, and it would tell you something about the customer, even if it's just in self-selection, that might influence the rate or the risk. 

Lately, you don't hear that much about it. It leads somebody to speculate like maybe there just wasn't enough signal there. The most common claim we have in home insurance usually involves some sort of water damage. The smart home devices promised to tell you about where to shut off the water that is causing it. But they're still rare. So, we just have not gathered enough data that says somebody who uses this type of device, or like a water shutoff valve is a better customer or not. 

So, the other side of this is where it actually prevents losses. Well, we found out that a smart home usually requires a lot of internet connections. Those break, they go down for five seconds, and all of a sudden the device doesn't work anymore and the customer doesn't know it until the leak happens or the pipe burst happens. 

Essentially, we don't have enough data or the signal is not strong enough to know what sorts of data from smart home devices will predict future loss. It's better for us to have a home with a shutoff valve than one that doesn't. It will stop the water and it's worth a discount. The issue is whether the discount would be more than the cost to install, maintain and monitor the device.

We've been giving discounts for burglar alarms to reduce your crime coverage for decades. But there are a couple problems: Ones that crime is not the biggest portion of your policy premiums. So if you cut crime in half with a burglar alarm, you might save half of half a percent. So, it isn't worth the cost of the burglar alarm.

The other thing is, you have to turn it on, it has got to work. And if the house is not being monitored in some way, like if the alarm goes off, you're getting a phone call, and somebody says: 'Hey, your alarms are going off, and we know you're not there,' then really the alarms are worthless. 

The third, more minor is issue is that the longer the technology is out there, the more ways you find that it gets defeated, the burglar figures out how to get around the alarm, or there's a new development in the technology of piping and drainage that your sensor device doesn't work with or your shutoff valve doesn't work with. 

The world is a moving object and [though] so far, the smart home has not yet found its insurance connection, [the] technology holds a lot of potential. I hope people buy it, because it prevents leaks and stops fires and burglaries. We've seen many examples where it has, it's just that overall it's harder to separate the signal from the noise.