The momentum of insurance companies as a channel for the purchase or distribution of smart products is increasing. State Farms enormous investment in ADT is another example of ADT diversifying its strategy to capture all angles possible. This new partnership with State Farm, coupled with Google’s investment in ADT, is a huge signal that major players are recognizing the need for integration across ecosystems in the home.
According to Parks Associates research, currently 4% of networked camera device owners indicate getting their smart home device from the insurance channel and 9% from the traditional security service channel.
This is another very smart move by ADT and State Farm. For households not interested in smart home products, discounts are the most effective means of addressing the concerns of non owners/intenders but even then, only marginally so. In fact, Parks Associates consumer research shows that discounts through insurance-providers address cost concerns for 9% of non-owners/intenders of devices.
The benefits of a partnership with a security player offering interactive services specific to safety and security are extensive:
- Risk mitigation for fire, water, and theft claims reduces costs to insurer and consumer
- Data from IoT devices provides a window into consumer behavior that can inform underwriting
- Smart home tech reinforces a brand position of protection and prevention, as opposed to simply providing claims payments
- Consumers trust insurers with data
- Consumers will switch providers where smart home tech is offered as an incentive
- Smart home technology provides means of regular engagement with consumers, creating bridge to future revenue opportunities
Other relevant research from Parks Associates:
- 23% of US internet households have experienced water damage.
- 13% have experienced a home burglary or break-in
- 7% have experienced fire damage
- 15% of security system owners in US internet households report that insurance discounts triggered their purchases.
Parks Associates has been a trusted business intelligence partners for technology and service providers for almost 40 years. For more information on our research work, visit www.parksassociates.com
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