The connected home- connected that is to service providers- promises those living in the property a multitude of added value services. Managing home deliveries, heating and lighting and prevention of loss and damage from fire, escape of water or burglary.
Insurers see this as an evenus of business growth as Property premium growth is sluggish. Take the tale of Hue as a warning to have the right technology partners.
The story of Hue
Philips Hue smart lighting systems are probably among the most widely installed smart home solutions in the world, so plenty of people needs to know about the latest Check Point research, which warns of a major security flaw in them.
Apparently, it is possible to infiltrate home/office networks using a remote exploit in the ZigBee low-power wireless protocol and Philips Hue smart bulbs and bridge as the access point
With a reputable manufacturer and something as simple as lighting imagine the potential for security flaws the more sensors and devices are added to prevention of risk solutions.
Policy holders generally trust insurers. In a Bain & Company report "Insurers: how to lead in the new era of connectivity" consumers were as likely to acquire connected devices from an insurer as a Tech Company (including Google, Amazon & Apple)
On the other hand the respondents ( over 167,000 policy holders) Bain & Co states :
"Customers still trust their primary insurers the most when it comes to providing the next insurance product, but they are switching carriers more often and are increasingly open to new entrants, including insurtechs, big tech and other nontraditional players."
Therein lies the rub. Get connected home prevention of risk solutions right and insurers add new revenue streams. Get them wrong and customers are more likely to switch to new entrants that master this market.
This makes the of matching your strengths to the optimal strategy and deciding which role is best for you in this new era of connectivity. With which partners will you be sure to be in a leading ecosystem?
Strategy, strategy, strategy.
I’m not about to focus my ire on Philips in this – the company took steps to remediate the situation once it heard about it. Nor is it exactly Zigbee that is at fault -- the truth is that every operating system holds its own set of vulnerabilities and identifying them is a big business. But I will focus some anger at those manufacturers in the smart home space who don’t see security and privacy as important in an increasingly connected age. Because the risk to home and business represented by poorly secured devices on your connected networks depends on the weakest devices installed far more than on the better ones.