Millennials are not buying homes, and instead they rely more on renting as their primary housing option. So, are companies benefiting more from renter’s insurance as a result of this change?
Renter’s insurance in particular, doesn’t generate big money for the agents. Not even with more Millennials renting, the pick-up rate in the renter’s market hasn’t really increased. Instead, a new trend is surfacing. New research by Park Associates shows that 40 to 50 percent of consumers with either homeowners or renters insurance policies show interest in receiving additional services such as restoration and maintenance services, from the same insurance provider.
“Forty percent of U.S. broadband households indicate intentions to buy a smart home device in 2018, and a key way to turn purchase intention into reality is to offer valuable incentives,” said Brad Russell, research director, Connected Home, Parks Associates. “Among these likely buyers, roughly 75 percent are interested in a feature that automatically notifies their insurer in the case of damage or a claim. Communication with insurance companies is clearly valued among smart home shoppers.”
It appears that consumers who are likely to pay for smart home products are also considerably more interested in getting additional services, including restoration services after damage has occurred. The study also found that consumers interested in buying smart home devices are generally more comfortable with data sharing and value differently data analytics, recognizing its value in simplifying and expediting claims processes.
“There are multiple go-to-market strategies for ‘insurtech’ solutions, from OEM and platform partnerships to device rebates, premium discount incentives, and free devices,” Russell added. “These arrangements have significant benefits to insurers as well, from competitive differentiation to expanded service offerings. The race now for both OEMs and insurers is to develop smart home solutions that can manage the data needs within this industry.”
But that’t not all. “Interest in home-living services will increase as the U.S. population ages,” said Kristen Hanich, research analyst, Parks Associates. “Nearly 50 percent of consumers 65 and older see these services as useful, but only 27 percent would pay for them for themselves. Younger people show more interest in using technology to support their quality of life and so are more interested in paying for home-living services for themselves.”
The research firm tested consumer interest in the following services:
- Alert system to notify family members if one is in an emergency.
- Services that send alerts to the consumer about dangers in the home.
- Concierge services offering advice on retirement and healthy home living.