Chubb finds IoT success with wine program
Like every insurance company, Chubb is looking for digital wins as it navigates the incredibly complex coronavirus era. One place it’s found success is in anInternet of Things program for wine collections.
Through a partnership with Hartford Steam Boiler, Chubb has been deploying temperature and moisture sensors with certain clients who have collections that are at particular risk for damage from big swings. Chief digital officer Sean Ringsted says that the sensors, which alert customers to potentially ruinous changes, are helping the insurer reposition itself as a risk-management partner rather than just a payment vendor in case of damage.
“We think about how insurance needs to change-- and will change -- from a ‘repair and replace model’ to ‘predict and prevent.’” he says. “This really is a great example of how real-time technology can help predict and prevent damage to collections before it occurs,”
Ringsted says that while avoiding damage to collectibles is crucial, there’s more to this model than just reducing claims volumes. Paying out has never really been an issue for the insurance industry, but the monetary loss isn’t the extent of the customers’ lived experience.
“This preserves the collection and avoids the claim. And I think that's important. We can give you the cash back, but it's everything else about what you've lost and how you've lost it,” Ringsted says. “If you do have damage to a wine collection, it’s not just the wine -- it could be structural damage and you have to figure out how to replace all of that. A monetary amount doesn't really do justice to the inconvenience you would face.”
It’s not just high-value insureds that will benefit from carriers like Chubb leaning into the IoT and a new standard for customer interaction and monitoring. But the use case provides an important pilot for applying the technology elsewhere. And there are lessons. For example, Ringsted says, what’s important off the bat is that the technology itself is easy to use and provides actionable data back to insureds that can prevent them from suffering big losses.
“You can have the concept, the idea. But it's really been enabled by the advances today in in technology,” he explains. “You're also after those very slight changes. That's all detected by the sensor and then that's passed back to the client in an app. And they can see the readings over real time and, if it goes significantly above the predetermined parameters, then we'll also go to the service center to trigger additional support.”
Amidst the massive upheaval caused by the COVID-19 pandemic, Chubb sees even more potential for sensor technology to become a crucial part of commercial real estate coverage. Offices are already largely deserted for the weekend, and if more people convert to work-from-home, there could be big sections of buildings seeing less use.
But beyond that, sensorized locations could also be a beginning to low- and even no-touch claims adjusting when something does happen, Ringsted posits.
“We have found immediate value in detection of potential issues before they become a problem in an empty occupancy -- with everyone at home, building the spaces is not occupied,” he says. “But to inspect buildings, we've also found value. It’s putting more remote site inspection on the claim side and the risk engineering side where you're using mobile technology to assess a claim or do inspection -- clearly, there's this potential.”