Are Smart Homes Safer Homes….Or Not? The Answer To This Question Might Affect What You Pay For Homeowners Insurance – Part III
In Part I of this three-part blog series on smart technology for the home, we posed the question, “Are You Smarter Than Your House?” By the end of 2017, nearly 12% of homeowners may not be – as that is the number of households that HIS Markit estimates will be laden with connected home devices such as thermostats lighting, security and entertainment, with an average of six devices per home.
At Bearingstar Insurance, we have seen this trend among our own personal insurance clients – more people are buying homes or renting apartments already loaded with smart technology or they are taking steps on their own to turn their home into a partially, or totally, connected living space. That’s why we wanted to explore the smart home phenomenon with you in a three-part blog series that discusses what makes a home “smart”, key details about some of the most popular gadgets in the marketplace today, potential downsides of this smart technology, and how having a smarter home may – or may not – affect your home insurance.
Take a look back at Part I for an introduction to smart homes as well as information about the new, common language that is enabling most smart devices to work together to make your home more comfortable, secure, energy efficient, and intelligent. Part II is a great read if you are thinking of adding smart devices to your home but are not sure where to start. We share information about three of today’s most popular smart technology gadgets for the home as well as any personal insurance implications.
Now, in Part III – our final installment in this blog series – we not only wanted to continue to discuss the smart devices that many people consider when they are building a smarter home, but we also wanted to highlight some of the reasons that not everyone is on board with smart technology for the home.
Below is information about the last three smart devices that we will discuss in this three-part blog series. Please read Part II for the first three gadgets we shared, as well as to get additional smart insurance tips.
Smart Gadget #4: Avoid the Mess, Distress, and Expense with an Early Leak Detection Sensor:
According to the Information Institute of Insurance (iii), through 2015, water damage/freezing claims were the third most costly homeowners claims – after fire/lightening and bodily injury/property damage – and the second most frequent claims made by homeowners – after wind/hail damage. If that’s not enough reason for you to consider a leak alert system, then we have one more for you: in just a few short months, the New England winter will be upon us, with all its sparkling and magical snowy scenes, as well as its highly unpredictable temperatures and precipitation. ‘Tis the season for ice dams and any water dripping or pooling in your home is one of the top warning signs that you may have one of these formidable structures doing damage to your roof. Catching a leak early can save you thousands of dollars in repairs for peeling paint, rotting wood, damaged drywall, warped floors, stained and sagging ceilings, soggy insulation, and mold and mildew, just to name a few of the damaging effects of water in your home. Obviously, the sooner you are aware of a leak, the better it will be for you, your home, and your wallet.
This is where these evolutionary disc-shaped sensors come into play. These smart devices can be placed anywhere in your home where water might drip or pool, including near your water heaters and sump pumps, behind appliances, under sinks, inside cabinets and throughout attics and basements. The detector will not only alert you to any leaks, but also monitor the temperature in the room where it is placed. Many people might not realize the damaging effects of extreme temps in the home. If the climate gets too hot, this can warp floors and furniture, cause mold and mildew to grow, and lead to malfunctioning electronics and appliances. On the other hand, if your home gets too cold, it may cause your pipes to freeze and potentially burst. Having a smart leak detector that alerts you to risky hot or cold temperatures in your home, especially when you are traveling, is priceless, but in reality it will only cost you a couple of hundred dollars per three-pack of units.
Like the other smart devices we’ve discussed, leak detectors connect to your home Wi-Fi and your smartphone or tablet, and will immediately send an alert to you if it senses an issue. In addition, these detectors warn you by using sound and LED light so that you can find the source of the leak quickly.
Bearingstar Insurance Tip #4:
While smart leak detectors may be an excellent way to stop a leak in its tracks, they don’t necessarily resolve the cause of the water drip. If the leak stems from a mechanical breakdown of one of your home systems, such as your furnace, central air, or water heater, you may still have to pay thousands of dollars out of your own pocket to repair or replace the broken equipment. This is a great reason to speak with your Bearingstar agent about an exceptional insurance option called Home Systems and Service Line Protection Coverage. This is an increasingly popular endorsement among our Massachusetts personal insurance clients because it provides up to $100,000 coverage for damage caused by a sudden and accidental mechanical or electrical breakdown for systems and equipment such as central air conditioning, water heaters, solar energy, well pumps, radiant floor heat, furnaces and heat pumps, pool and spa pumps and more. Plus, it provides up to $10,000 for repair or replacement of service lines.
Smart Gadget #5: Keep Your Cool and Save Money With A Smart Air Conditioner:
If you have a relatively new home, then you may have a central air system installed and not even remember the days you had to yank out noisy, heavy, drippy A/C units at the end of every summer or drag them out of storage at the end of every spring. For the rest of us, who live in charming older New England homes, this is something we have resigned ourselves to grunt and groan through twice a year, every year.
Perhaps it’s crossed our minds to see what it would take to upgrade our home to a much quieter and more efficient whole-house central-air-conditioning system, but we have decided to put up with this taxing routine to avoid both the disruption to our home and the thousands of dollars we’d have to spend to put in this system. But now, there are Wi-Fi controlled smart room air conditioners that may very well be the air cooling option that we’ve been dreaming of. For just a few hundred dollars, you can have an air conditioner with sleek and modern mesh grills and LED lighting that actually blends with your home’s décor rather than ruins it.
You’ll most likely save money and time with these new smart units due to the following features:
- Easy-to-install window kits that feature insulated side panels to minimize air leaks and ensure that cool air remains in the room
- Custom scheduling options
- Uses less energy than standard air conditioners
- Alerts you to maintenance issues, such as when it’s time to clean the filter
In addition, you can control your AC anytime, from anywhere using – you guessed it – your smart phone, whether you want to turn your unit on or off, change the temperature, or adapt any of the other modes to make the climate of your home more comfortable.
Bearingstar Insurance Tip #5:
From an insurance perspective, these AC units are considered your personal property. Thus, to ensure that you can repair or replace your smart AC in the event of damage or destruction due to fire, wind or severe weather, it’s important that you update your home inventory list (you have one right?) with not just these devices, but any new smart gadgets you’ve been adding to your home. You can also take pictures of your ACs and other belongings and, for safekeeping, put them in a fireproof and waterproof locked box. Having an updated list at all times will make it much easier to file a claim if any of your smart technology or other items are broken, lost or stolen due to a catastrophic event.
Smart Gadget #6: Have Your Very Own Personal Assistant When You Buy Smart Speakers:
These devices are likely to be one of this year’s hottest holiday tech gifts. Luckily, for anyone with smart speakers on their holiday shopping list, you’ll have more options to choose from than ever before. Aside from industry frontrunners, Amazon’s Alexa and Google Home, competitive products and pricing are coming from Lenovo, Harmon, Samsung, and many more.
These connected devices are said to have been designed to encourage people to increase their online shopping. After all, if you want to buy something these days, you can just say, “Alexa, order Meyers Hand Soap.” Or, if you like a bargain, you can ask, “Alexa, what are your deals?” Or, if you’re more of a list-maker, then just command, “Alexa, add Honey Bunches of oats to my cart.”
However, while these so-called “virtual assistants” certainly make it much more convenient for people to shop online, “buying something on Amazon Prime” doesn’t even crack the top ten things consumers are using their smart speakers to help with. Instead, these devices are most often being used to: set a timer or alarm, play songs, read the news, check the time, control smart lights, provide traffic, and tell a joke.
At Bearingstar Insurance, we enjoy Alexa’s sense of humor as much as the next person; however, we think one of the most promising uses for these virtual assistants is to be another tool that makes your home a safer place. Using the IFTTT (IF This Then That) applets – specific voice commands – there are many smart security products that you should be able to connect your speaker to, including door locks, security alarms, cameras, video doorbells, motion detectors and more. One of the significant benefits to this is that you are no longer attached to your phone to receive alerts or set controls and can simply use your voice to ensure everything is secure and comfortable at home.
Bearingstar Insurance Tip #6:
You might think that having your very own personal assistant, like Alexa, along with several other connected gadgets, would increase the value of your home. But, in most cases, these items are considered personal property –essentially everything that would fall out of your house if you turned it upside down – and, for the most part, they do not cost enough to warrant a reevaluation of your home by your insurance agent. Plus, with the cost of smart technology for the home expected to decline in the future, even if you end up investing in the whole kit and caboodle of smart devices, you actually might only be spending a few thousand dollars, which is not going to make a significant impact, if any, on your home’s replacement value. That being said, if you install any systems that would fall under dwelling coverage – intelligent solar panels for example – then you should have a conversation with your Bearingstar agent to evaluate how this addition might affect your home’s replacement value.
Can your smart home ever be too smart?
An annual smart home survey conducted by Lowe’s Home Improvement store found that home security – more than any other benefit – is likely to drive the majority of new customers to getting smart technology for their abode.
Yet, there is still a sizeable number of consumers who are not ready to hop on the connected home bandwagon now – and may never be – for some very good reasons. As your local insurance professional, we feel it’s important to advise you on some of the drawbacks to smartening up your home in case you haven’t considered them.
One of the primary concerns for many people is how susceptible our Wi-Fi connected devices are to cyberattack. Just this fall, in fact, researchers Mathy Vanhoef and Frank Piessens of imec-DistriNet Research Group discovered a serious new vulnerability called KRACK (Key Reinstallation Attacks) which is a weakness in WPA2, the protocol that secures all modern protected Wi-Fi networks. Basically, a KRACK attack allows the hacker to read information that was previously assumed to be safely encrypted and to access important information like credit card numbers, passwords, emails, chat messages, photos and anything else transmitted over your Wi-Fi network. Depending on your network configuration, KRACK may also allow the attacker to infect your devices with malware and ransomware. The researchers emphasized that any device that uses Wi-Fi, whether you are in your home, the coffee shop or at work, is most likely affected by this vulnerability.
Thus, one of the most important first steps to safeguarding your home if you have smart devices is to make sure that all of this technology is secure as well. As digitaltrends.com points out, it doesn’t really matter how many locks or cameras your home has if a cyber intruder can just turn them off. Security experts have the following tips on how to avoid having your home systems hacked:
- Don’t trust random VPNs (Virtual Private Networks). Go with one you can trust, that you pay for, and that does not keep logs of your internet activity or transactions.
- Check every day to see if your router has any pending firmware updates. Companies will likely be rolling out patches over the coming weeks in response to new threats like the KRACK attack. Note that just changing your Wi-Fi password will not prevent attacks.
- Keep all smart devices updated with the latest software and patches.
- Be cautious what and who you allow your smart speaker access to. This includes being aware if your virtual assistant is browsing only secure websites when you ask for the weather, sport scores or help with your kids’ history homework. URLs that begin with HTTPS are websites that provide an extra layer of security by using encryption.
- Set up security within your smartphone device. This is critical in case your phone gets lost or stolen, in which case it could quickly turn into a security risk for everything attached to your smart home hub.
It’s unlikely that a KRACK attack or similar hack would come after your smart appliances – unless they really want to wreak havoc on your Thanksgiving dinner. Instead, tech experts say that home owners should be more concerned about a hacker “listening in” for log in information to their smart door lock or security camera app. So, the smartest thing to do is to protect yourself, your family and your home by locking down your internet Wi-Fi using the five steps above as soon as possible.
Choose a smart insurance partner to protect your smarter home
At Bearingstar Insurance, we understand that some Massachusetts and Connecticut homeowners, condo owners and renters are enamored with smart technology and partial or complete automation of their homes, while others are hesitant to connect to anything. Then, there is everyone else in between that is interested in testing the waters by trying one smart device out at a time.
Whatever your level of enthusiasm is towards intelligent devices in the home, our knowledgeable team is here to provide you with the right insurance options to protect the smart technology, as well as the other personal belongings, you bring into your home. We are also ready to assist you with identifying any discounts you might be eligible for since adding or enhancing your home security with smart technology products. Finally, our team works hard to stay updated on the exciting innovations – as well as the shortcomings – of this growing industry to ensure your insurance options are keeping up with the technology of today and the future.
For more insurance tips related to smart technology in the home and/or assistance with all of your home insurance needs, contact a friendly agent near you at any one of our convenient locations across Massachusetts and Connecticut. We look forward to sharing this information with you so you can make smart decisions about technology and insurance for your home.