Most of us (operating within the Malaysian insurance markets) would probably have a good idea of what telematics is all about, vis-a-vis its application in the motor insurance lines. But how about telematics in homeowner and householder insurance? Is this workable or perhaps practical if we were to read its practicality from the context of PDPA, how data is to be stored and analysed.
Here is the article from POST which you may find handy trying to gain some understanding of the use of telematics in home related insurances. …
By Francesca Nyman Insurer 29 August 2014
Post explores the main benefits insurers could derive from the connected home, if they play their cards right.
With analysts forecasting the connected home market will be worth £40bn in 2018, insurers unsurprisingly want a piece of the action. But with home telematics developing on very different lines to its vehicle counterpart, some wonder where insurance fits in.
1) Better risk selection
Although this is unlikely to be on the scale of the self-selection benefit seen with motor telematics – as young drivers used to paying disproportionately high premiums had a huge incentive to opt for a black box if they believed themselves to be good drivers – those willing to allow monitoring devices into their homes are likely to be more safety conscious, thus presenting a better risk for insurers off the bat.
2) Risk prevention
Connected smoke and water leak detection alarms, and security systems can help to avert disaster before it occurs. The difference could be between a small escape of water claim- notified via a smartphone and addressed early, and extensive flooding, forcing a family to be relocated for a period of weeks or even months.
3) Improved loss ratios
Connected devices could help to bring down claims costs by allowing early intervention, and in the cases of suspected fraudulent cases, helping to verify whether the event actually took place, thus allowing insurers to improve loss ratios in an area that traditionally operates on fairly tight margins.
4) Marketing advantage
Companies that team up with telecommunications or alarm system providers as State Farm in the US and Allstate in Canada have done may be able to offer discounts off both device installation, and home insurance, which could give them an edge on the competition when it comes to attracting new business.
5) Data, Data, Data
Data management with the connected home is likely to be even more of a minefield than with motor telematics as the connected home could involve a network of dozens, even hundreds, of data points each working slightly differently in each home. However the early movers that manage to collate all this data and draw meaningful comparisons from it will have a tremendous advantage over the competition.