The IoT of Home and Business Insurance

Oct 23, 2021 | Business Insurance

The Internet of Things

Our innovators are working hard every day to further our technological advancements. The term Internet of Things is popular nowadays, some people find it intimidating. 

To put it in simpler terms, the Internet of Things is the ongoing and developing project of our innovators. The goal is to automate our daily tasks. The vision for the Internet of Things is to connect the objects that we use every day to the Internet. 

These objects could be different devices that we today refer to as “smart” devices.

These devices have the capability to collect and transmit our data to other devices. The data then can be used to promote our way of living every day.

Connected Everyday

The Internet of Things can be a bit technical, but its intention is for the common good. It is developed to keep us all connected, which can then keep us safer and reduce our risks. 

Take the smartwatch devices as an example. Sensors in smartwatch devices serve as a big help in the medical industry. Healthcare providers use this to diagnose illnesses and wellbeing. Not only in smartwatch devices; but smartphone sensors also have this capability. The sensors collect data from your activities. Some advanced programs in the market use these data to come up with a health report. Thus, these reports can be analyzed by health care professionals.

It is a known fact that your driving record could help you reduce your insurance premiums. With the Internet of Things, cars’ telematics is now used by some insurers to inform their insurance policyholders about their driving habits. 

The Internet of Things is literally everywhere. It can be worn, in your house, in your car, even in your kitchen. These smart devices can help in automating insurance tasks and paperwork. Not only that, but it can also help in the marketing aspect as it will give insurers insight into the behavior of their policyholders.

Insurance Update

As most insurance companies turn digital, these companies do not only improve their processes but also their competitiveness. Customers consider a couple of factors in choosing their insurers; one is the pricing, and two is their security. 

  • Pricing may vary and depends on a lot of things. Insurance companies add the area they are operating on when it comes to pricing. Take auto insurance as an example. There are certain places where telematics have a higher discount. In some countries, where the demographics of home renters are high, they won’t install smart devices into their homes. These people would not invest in a property that they are temporarily staying at. And it isn’t there to invest in at all.
  • The Internet of Things has its challenges. One of them is cybercrime. Customers are now keen to keep their data private when giving it to companies online. Insurance companies are now investing in tightening their cybersecurity in order not to compromise their statistics and their customer’s data. Customers themselves can protect their own data by creating strong passwords and changing them on a regular basis. But customers can only do so much. It is a part of the insurance company to secure their customers’ data.

As insurance companies start to invest in their own smart systems and devices, most of them will also form partnerships with IoT providers. The attempt in going digital is a two-way street. Customers should be able to understand what these changes could do to them and how they are benefitting from it. And insurance companies could find partners in the digital market that could help them give their customers what they deserve. Whether these factors are better and more affordable pricing and rebates, or even additional services. Insurance companies should always be with their customers every step of the way with their change into digital. Some customers are uncomfortable to change, insurers are also responsible for making sure that not only their transition to digital is smooth. They should also consider their customers’ ability to adapt to change.

Insurers are investing in digital initiatives to embrace the change and innovate their relationship with their customers. The Internet of Things affects the way companies used to price, purchase, and manage insurance. As the years go by, insurance companies will fully implement the Internet of Things into their business operations. 

IoT in Insurance 

Insurance companies use IoT to give a better and more accurate risk evaluation and prediction. The Internet of Things also helps insurers in building a stronger customer relationship by making claims processes easier and more efficient. Sooner or later, the Internet of Things can also be used to produce better insurance products for all.

As the Internet of Things continues to evolve, insurance companies, as well as policyholders, can benefit from this. To help customers see the benefits of turning digital, we have listed some of them:

  • Answering customers faster. With the help of the Internet of Things, insurance companies can now provide better and faster customer service and customer experience. By going digital, customers can now talk to insurance agents without going down the office. This speeds up the process of claims, as well as providing more accurate and error-proof data for customers. Some insurance companies even put up a Frequently Asked Questions (FAQ) section on their websites or applications. This is to answer the basic and most asked questions about their services. This saves the company and the customer a lot of time and effort.
  • Tracking for customers is easier. As insurance companies connect their data, customers can now view and monitor their coverage and claims through their smart devices. Most of us are glued to our smartphones already! Insurance companies are now investing in the production of mobile applications that lets us view our coverage and other insurance information. Some of these applications are also allowing us to do basic processes and tasks that we used to do down in the insurance office.
  • Building a more accurate insurance model. Insurance companies rely on your past insurance records and long-term analyses to assess risks. This makes data processing and analyses an integral part of insurance companies. By staying “connected”, insurers can now produce a more accurate risk assessment. Having a reliable and accurate risk assessment report could help insurance companies produce more decent premiums. The data that insurance companies collect gives them the edge to better understand the needs of their policyholders. By knowing their customers, insurers can now address their customers’ needs and provide a more suitable insurance coverage for them.
  • Preventing losses. Collecting massive data in real-time because you are connected all the time helps customers too. Not only does it help insurance companies in giving accurate predictions, but it also helps customers by alerting them of any potential loss. Preventing loss is better than reducing the number of claims that customers have to pay.

Feel free to read through our article about insurance and technology — Insurtech. 

Ways the IoT Helps You

The Internet of Things isn’t just for businesses and companies. There are lots of ways that the IoT can help you as an individual.

  • You can have full control over your home. As long as you are connected, you can take over your house even if you are at work or on a vacation. The heating, the lights, and other appliances in your home can be hooked up on the Internet and into your phone. From your phone, you can adjust the temperature, lighting, and even turn off certain appliances. Your smartphone can serve as a remote control for all the things in your home. This allows you to protect your home anytime, anywhere.
  • You can now develop advanced safety programs for your employees. One of the basic things that the Internet of Things can do is automate repetitive processes or tasks. Improving your claims systems by automating them can help your business in generating reports and analyses regarding employee injuries.
  • You can promote safe driving. Employers can now monitor their commercial drivers by using smart vehicles. The same with most “smart” devices, a smart vehicle collects data based on patterns, behaviors, and activities. This will be used for reports and analyses to improve driving.
  • You can monitor your teens’ driving. Personal autos can now be hooked up with smart devices, so parents can keep an eye on their children’s driving. These devices are sometimes offered by insurance companies as an incentive to lower their insurance premiums.

Smart cars, smart homes, and smart health are just three of the aspects that the Internet of Things and insurance are working on. From there it will branch out to other things such as home security and financial monitoring.

Thanks to our innovators, we can update our business and home insurance online. We at Advantage Insurance Solutions continue to give the best to our customers by building strong relationships with them. You can reach out to our insurance experts, and they will be glad to help you make the right choice in your insurance journey.