Water leak detectors reduce home insurance claims, severity in study
Leak detection devices reduced water-related home insurance claims severity by 70%, according to a study by LexisNexis.
The company worked with Flo by Moen, which gave it access to data from 2,306 homes that installed the manufacturer's Smart Water Shutoff leak detection and water monitoring system and compared the insurance claims activity in those homes to a control group of 1.3 million homes without installations over a period of two years.
The installed homes reduced water claims by 96%, and when they did have a claim, severity of that claim was down 72%.
“Escape-of-water claims are considered the most preventable of major loss cost events, and we believe devices like these have a chance to solve a challenging problem for insurers and homeowners," said Dan Davis, Director, IoT and Emerging Markets, Insurance, LexisNexis Risk Solutions.
Despite their effectiveness, leak sensors are among the least popular IoT devices with consumers. Other LexisNexis research finds their installation rate about 6% or 7%. About four times more customers have installed smart thermostat devices; rates of video doorbell and other security items is also higher.