The ROI From Smart Home Devices Could Be Coming as Insurers Offer Discounts 

Property owners who add smart devices that monitor doors, windows and fire alarms, as well as such potential domestic disasters as water leaks, can now receive discounts on both the devices and their homeowners’ insurance premiums. 

This comes as a growing number of companies are offering these discounts while also working to educate consumers about how certain smart home devices can prevent or mitigate damage. For example, Nationwide reports that roughly two-thirds of homeowners currently use smart alarms, monitors or doorbells, but just 7% used smart sensors to monitor for water leaks — even though the leading cause of avoidable claims for its homeowners’ insurance policyholders is nonweather-related water losses, which average $11,000 in damage. 

“A key learning has been that consumers’ interest in security is highest, but interest and awareness of water loss protection is low,” Sarah Jacobs, Nationwide’s vice president of personal lines product development, told PYMNTS in an email interview. “The 2022 program expansion will focus on creating awareness about the damage that non-weather water can cause and increasing the number of homeowners protected with smart home water sensors.” 

Discounts on Policies and Devices 

Nationwide is not alone in its promotion and discounts for smart devices, noting that its customers save 4% on their premiums. The company launched this program in three states in 2020, currently offers it in 13 states and announced on Monday (Oct. 11) that it will add more states in the coming months.

“The percentage of policyholders using the program is low, since the program is in its early stages,” Jacobs said. “However, we are seeing significant growth and anticipate seeing even more in the future as campaigns like this one increase awareness of the program.” 

Nationwide last year partnered with Notion, a company owned by Comcast Cable, to provide a home monitoring system with sensors that monitor doors and windows, smoke/CO2 alarms and water leaks, alerting homeowners if something goes wrong.

Other insurers offering smart home discounts include Country Financial, which offers a break for smart thermostats; Amica, which gives discounts and special pricing for the installation of smart home water security systems; and USAA, which allows homeowners in select states to enroll in its Connected Home program and purchase device kits at a discount. 

Banking on Smart Home Services 

Home security products and services have attracted the attention of Google and Amazon, too. PYMNTS reported in June that the home security company ADT is banking on a partnership with Google’s smart home services to help boost its revenue. 

See also: ADT, Google Developing New Home Security Products, Services

An earlier agreement saw Google pay $450 million for a 6.6% stake in ADT. The companies said at the time that they planned to integrate Google’s hardware and services into ADT’s products and its team of more than 20,000 professionals, and that they would spend another $150 million for marketing, technology, product development and employee training. 

The two companies face competition from Amazon, which owns video doorbell companies Ring and SimpliSafe. 


Posted on

October 13, 2021

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