Smart Homes and Insurance

By definition, a smart home is a living space with some sort of connected technology that is meant to enhance your home. This type of technology can increase convenience, security and comfort. As it’s the actual devices and technology themselves that make a home “smart”, any home can technically be a smart home whether you live in a one-bedroom apartment or a giant house.

The current market is home to tons of different products with smart capabilities. These products range from technology to help you control your lighting to products that can become a virtual personal assistant for you. Every room and area of your home is now able to include some sort of smart technology to assist you in your daily tasks and provide you with extra protection.

As this technology becomes even more advanced, it is likely that more and more Canadians will invest in these types of products in the coming years.

How will having a smart home affect my insurance?

One major concern that homeowners have about smart technology is how it will affect their insurance rate. Many people believe that due to the increase of expensive technology in their household, their premium will increase. However, that is not the case.

Having smart technology in your home could actually result in a decrease of your insurance premium. This is because having smart products helps mitigate the risks of things such as theft and water damage. If you reduce the chances of these types of things happening, you reduce your risk of submitting a claim. In turn, this could result in a lower premium.

However, not all smart technologies will contribute to lowering your risk. Things such as smart TVs and Google Home have no effect on your premium whatsoever. Only specific products and technologies will count towards mitigating risk, all depending on their purpose.

How can different smart products affect my insurance rate?

Smart Alarms

This product is one of the most common smart technologies owned by consumers in Canada, due to its security and surveillance benefits. There are many different types of smart alarms on the market. They range from very simple systems to very complex systems, and come with a multitude of different features and uses. Some of the things the majority of smart alarms can do include:

  • Stream 24/7 video feeds of your property straight to your phone
  • Notify you if any motion is detected on your property through an app
  • Allow you to set a timer to arm and disarm it at specific times of the day
  • Give you access to speak directly to whoever is at your door through two-way talk functions
  • Allow you to give temporary access codes to your friends and family

As this technology provides you with extra protection against intruders and thieves, many insurance companies offer discounts to clients who have smart alarms.

Flood Sensors

A flood sensor, all sometimes called a “smart moisture detector”, is used to monitor your home for any moisture that should not be there. It will be able to detect if any pipes or appliances are leaking, or if any water has infiltrated your home from a drain or from outside. If moisture is detected, the sensor will send you a notification on your phone so you are aware of the issue immediately. Some sensors on the market are even able to turn off your plumbing or appliances if they are the cause of the leak.

Right now, insurance companies do not offer discounts for flood sensors. However, this type of technology can prevent floods and water damage from occurring in the first place. In the last five years, one in four house insurance claims were a result of water damages. Therefore, any technology used to prevent this can keep your overall costs down and give you peace of mind.

Smart Locks

A smart lock provides homeowners with way more control of who can and cannot enter their home. These electronic locks attach to your door in the place of where your traditional lock would be. They allow you to lock or unlock your door right from your phone, whether you are on your property or not. They are also able to send you a notification any time someone opens, or tries to open, your door.

If you ever leave your house and forget to lock the door, you can simply open your phone and do so from where you are located. This product also comes in handy if you need to give someone one-time access to your home. You can simply give them a unique pin code to unlock your door, and then revoke their access when it is not needed anymore.

Take note that smart locks can be a double edged sword. The convenience factor is great, but this technology could lead to cyber hacking. Some insurance companies discourage their clients from utilizing this technology because of the possibility of hacking Give your insurance broker a call before installing smart locks to find out how it could affect your insurance rate.

Smart Smoke Detectors

This product is incredibly valuable to have in your home, especially if you have a wood or gas fireplace and/or stove. Smart smoke detectors will send you an alert if the presence of smoke or fire is detected in your house. These sensors also have the ability to update you on the strength and health of your detector and will notify you when its battery needed to be changed. If the alarm goes off accidently, for example due to baking or cooking, you can quickly turn it off right from your phone.

Many of these smoke detectors also include carbon monoxide detectors built into them. These will generally include the same features and abilities, but will pertain to carbon monoxide in addition to smoke.

Smart Doorbells

A relatively new product, a smart doorbell is a great addition to your pre-existing security features, or an awesome product to start off with. These doorbells have a very small camera attached to them that is able to stream video feeds of your doorway directly to your phone, whenever someone approaches or if any other movement is detected. This product is a great way to deter any potential thieves, and to monitor your home while you are away.

Smart doorbells are quite accessible to Canadians; they are now sold at most major retailers and have a wide price range. They are also very easy to install and set up, as all that is required is working doorbell wiring.

Should I invest in smart technologies for my home?

The decision to invest in smart technologies is yours. Some tools, such as smart alarms, can result in a discount. Others have no impact on your premium, but might give you more peace of mind. Some technologies could increase your risk of being cyber hacked and should be used with caution. Keep in mind that these technologies are new, and as they become more common, insurance companies might change their policies. If you’re ever unsure of how a new technology might affect your premium, give your insurance broker a call. We are always happy to chat!

Do you own smart technology, or are thinking of investing in any, and have questions about your premium? Or do you simply have more questions about home insurance? Get in touch with one of our licensed insurance professionals 7 days a week.

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