How is the use of technology in the home affecting insurance?

We are entering an age of smart and connected homes where technology is as much a part of the furniture as your favourite sofa. A decade ago, the idea of integrating technology into the fabric of our home lives would have seemed bizarre but today it’s very much a reality. From CCTV to being able to switch the oven on with your phone before you walk through the front door, technology is everywhere in our homes now and designed to make life much easier. So, how is this affecting the way that consumers interact with insurance?

The rise of the tech-smart home

Home is where the heart is as the saying goes. And it’s also where we sleep and eat, socialise and – for some people – work too. In recent years our homes have become ever more filled with life enhancing technology created to help us get more from our busy lifestyles. There are the basic technologies, such as smoke detectors and burglar alarms.

Some homes may have CCTV and others video surveillance that is controlled via a smart phone app, either to answer the door when the occupants are out of the house or to keep an eye on pets, for example. Smart homes today can regulate their own temperature and humidity, which can also be controlled remotely by the owner, whether that’s to warm up the house for the moment of arriving home in winter or to create a safer, healthier environment.

The benefits of smart homes

Convenience and cost are the two main reasons that many people subscribe to the idea of a smart home. With control over various elements of the home at your fingertips – often via an app – it’s possible to be much more in control of how the home functions. Cost is another big factor – saving money by avoiding wasteful energy use or preventing burglaries, for example. There are many reasons why people choose to integrate smart features – and there may also be savings to be made when it comes to insurance too.

Connected devices and insurance savings


Essentially, smart homes can potentially reduce the risks for insurance companies, which provides the opportunity for insurers to pass on cost savings to consumers when it comes to premiums. For example, in a home without smart features, if there is a water leak in the morning this is unlikely to be spotted until the property is occupied again when the owner comes home.

However, in a smart property the owner could be alerted as soon as the leak occurs, meaning it is more quickly dealt with and less damage results. With better security, emergency alerts and the ability to protect a property and its contents it’s less likely that owners will need to make claims. Plus, insurers will have more accurate data for loss ratios.

The era of smart homes has many benefits for both consumers and insurers – it should make claims less likely but, if they do occur, more accurate and transparent to handle.

For all your insurance software requirements, get in touch with Mandon Software today.

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Mandon Software is a UK-based company founded in 1999. We work with customers in a wide range of insurance lines, from marine to healthcare. We are experienced in working in the Lloyd's market and pride ourselves on delivering excellent customer services at all times.