Parks PointsConsumer Attitudes on Smart Home Products and Insurance Use Cases
by
Brad Russell |
Consumer attitudes toward adoption of smart home devices provide critical guidance for insurers and their ecosystem partners in crafting their IoT strategies. Both consumers and insurers show growing recognition that smart home technology can help protect the home and reduce loss and associated costs. With smart home purchase intentions increasing, insurers have a significant opportunity to acquire and retain customers by offering new and innovative ways to mitigate risk and protect their homes. Adoption of at least one smart home product reached 26 percent of U.S. broadband households in 2017, up from 19 percent in 2016, according to Parks Associates research. Recently, Parks Associates tested consumer interest in smart home devices that can detect potential damage or loss due to water, fire, and theft and then notify the homeowners and/or take automated steps to prevent the loss. Almost 60 percent of U.S. broadband households reported a likelihood to purchase one of several smart home products with these insurance-related features. While purchase intentions don’t translate to adoption, there is clearly strong interest for insurance-related devices. Interest in antitheft devices slightly edges out interest in water and fire products, but the opportunity is equally robust for all three device categories. On average, 30-40 percent of consumers are interested in smart products that address various use cases in these categories. When looking at the likely buyers of smart home products based on their insurance providers, GEICO has the largest percentage of customers who show interest in smart products with damage/protection features. Several factors may contribute to this:
Consumers who already have insurance (either homeowners or renters) see the value in acquiring smart home products when benefits are tied into their insurance benefits. Nearly 50% find loss detection/prevention products that automatically notify their insurer to be appealing. Discounts on insurance premiums provide the most-preferred incentive for acquiring smart home products. Almost 60 percent of consumers choose premium discounts over other types of incentives when asked what kind of incentive to buy smart home products. Smart product manufacturers can open a new sales channel and boost overall adoption through partnerships with insurance companies, which could provide co-marketing programs and product discounts for consumers. For smart home shoppers, linking smart products to insurance services is also appealing. Among likely purchasers of smart products, 74% find automatic notification of insurers appealing. Insurers can leverage this interest, and the benefit of convenience in expediting and validating claims, to differentiate their services and attract new customers. Nearly 40 percent of consumers report they would switch insurance providers in order to obtain smart home products.
Originally posted on Dearlerscope.
Brad RussellResearch Director, Connected Home INDUSTRY EXPERTISE: Connected home technologies and services, IoT data privacy and security, home networking, insurtech, connected health, housing innovation, home energy management Brad leads Parks Associates’ connected home team, exploring leading-edge issues converging in the connected home—smart home devices and services, residential security, home networking, IoT data privacy and security, data-driven applications, and platform services. Brad’s custom research work includes market sizing and forecasts, ecosystem and competitive landscapes, channel analyses, and go-to-market strategies.. Brad balances the art and science of market research to generate insights that lead to more astute business strategy and value-generating practices. He has a background in marketing communications, technology startups, and online media. Brad received his Bachelor of Science degree in advertising and marketing from the University of Texas at Austin. He also earned a M.Div. and a D.Min. with concentrations in ethics and cross-cultural collaboration. |