GlobalData’s Automated Home in Insurance report focuses on the development and opportunities facing the insurance industry as the prevalence of IoT-oriented smart home devices increases across the world. Consumers have been able to derive numerous benefits from installing such devices into their homes, with leading advantages including energy efficiency, home security, and lifestyle comfort.
The report discusses how insurers will also benefit from the implementation of certain devices into consumers’ homes. The scope for these devices to mitigate and minimize the impact of various types of claims within the home line has become increasingly apparent. With insurers grappling with ever-growing claims costs in the household insurance market, encouraging consumers to install these devices in the home will alleviate huge pressures on the bottom line.
- GlobalData estimates that the smart home insurance market in the UK is worth GBP180 million ($220 million), just 2.8% of the current home insurance market
- Given the openness to interpretation of a ‘smart home’, GlobalData predicts that the market could be worth up to GBP3 billion ($3.64 billion) by 2026 (48.1% of the household insurance market), depending on which (and how many) smart devices are required to constitute a smart home.
- The prevalence of smart devices across households in a country will determine the size of that country’s automated home insurance market. The US automated home insurance market is the largest and most advanced – financial savings is the main incentive for consumers to share smart home data.
- Data sharing and privacy concerns, as well as the increased threat of cyber-attacks, will be key barriers for insurers to break down.