Smart-home devices

Installing them may give you a discount on home insurance

Smart-home devices aren’t just about convenience. Some of them can also earn you a discount on your homeowners insurance by keeping your home safe and secure.

Discounts for smart-home devices NerdWallet

1

reached out to a dozen insurance companies and found that most of them offer discounts to homeowners with smart-home devices designed to prevent water damage, fire or theft. In

our research, we found companies advertising homeowners insurance discounts up to 13%, depending on the device and where you live.

Among the companies we surveyed, the smart devices most commonly eligible for discounts were water leak sensors, security cameras and smoke detectors. Insurers like Farmers and Lemonade also offer savings for smart locks, while Amica and Farmers give discounts for motion sensors.

If you already own a smart-home device, ask your carrier whether you’re eligible for a discount.

2 Why insurance companies reward smart-home devices Insurance companies offer discounts for smart-home devices because the technology can help catch problems early, potentially preventing expensive claims. Say you have a smart water sensor next to your water heater, and the appliance springs a leak. The device could sound an audible alarm and send an alert to your phone, enabling you to take immediate action.

Without the sensor, you could end up filing a claim, paying a big deductible and having contractors in your basement cleaning up damage, says Brett Sobol, senior growth initiatives lead at Hippo. But with the sensor, the damage might be so limited that you wouldn’t need to make a claim at all.

3 Should you buy smart-home

devices? The cost of smart-home technology can add up quickly. If you want to invest in a protective device but aren’t sure which ones are worth the money, consider your home’s unique risks, says Karen Collins, assistant vice president of personal lines at the American Property Casualty Insurance Association.

For instance, if your home has older plumbing, water sensors might be worth buying, Collins says. But if you live in a neighborhood with high crime rates, your money might be better spent on a home security system.

Ask your insurer whether the devices you’re considering would qualify you for a homeowners insurance discount. Depending on the amount of the discount and the cost of the devices, they might pay for themselves within a few years.

This article was provided to The Associated Press by the personal finance website NerdWallet. Want to suggest a personal finance topic that Quick Fix can address? Email apmoney@ap.org.