We’re getting closer to what science fiction has long predicted: Robots watching us all the time.
Our story in 2021 is a bit different, though. Instead of planning an apocalyptic uprising, these machine monitors can help us save cash on insurance.
Digital tools are having a major effect on consumers' habits and expectations : PwC research shows 41% of consumers would consider dropping insurance providers with poor "digital capabilities."
Here's how the friendly machines of today can help you lower your insurance premiums.
Get rewarded for safe driving
You’re a good driver, right? Why shouldn’t you pay less if you’re less likely to get into a collision?
Time to prove it.
Many insurance companies offer what’s called usage-based car insurance (UBI). Gadgets you install in your car will record where you go, your speed, acceleration, braking tendencies and a bunch of other data.
Some insurers will knock the price down just for installing a telematic device, maybe by 10-15%, then come through with an even lower price after they’ve taken a look at your driving habits. A report from the Brookings Institution estimates that nearly 66% of policyholders with UBI in the U.S. will spend less for auto insurance, saving approximately $270 each year per car.
You might end up saving even more than that. A study from the University of British Columbia found motorists tended to form new, safer habits in the first six to eight weeks. Who’s going to drive recklessly with someone watching over their shoulder?
If using a telematic device does make you a safer driver, you’re less likely to be involved in a collision, which would, in turn, lower your premiums in the long run.
Is it worth it?
Read the fine print: Some car insurance companies might raise your premiums if you don’t score well during the review phase. Some states don’t allow this, but if you are planning to participate in a UBI program, make sure you ditch your bad habits first.
There’s also the question of privacy — should we be sharing where we are at all times just to knock a few bucks off our bill?
Even if you don’t opt for UBI, there'a still plenty you can do to keep your costs down.
The biggest way to take a bite out of your bills is to look for the best rate. It might seem obvious — but when’s the last time you shopped around?
If it’s been longer than six months, you could be wasting more than $1,000 per year. With a free quote-comparison service, you could find better prices in minutes.
Lower your home insurance premiums
It sounds like an episode of Black Mirror, but you can connect almost every aspect of your home to the internet.
Some of these smart home products, like smart drinking glasses or smart beds, probably aren’t saving you any cash. But a video doorbell or smart door lock may help thwart would-be burglars, leading some insurance companies to reward you with lower rates.
And according to the Insurance Information Institute, water was the third-leading cause of claims from 2014-2018, with an average cost of $10,849 per claim. New technology can tell homeowners about early signs of a pipe leak, allowing them to schedule repairs before a manageable problem turns into a costly claim.
But before you connect everything and your kitchen sink to the internet, make sure you’re not missing the easiest way to lower your bills: shopping around for better rates.
Save on health and life insurance
In 2018, John Hancock, one of the oldest and largest North American life insurers, announced it would only sell “interactive policies” — those using health and fitness data from the policyholder to adjust premiums or give discounts.
Wearable fitness trackers can log your exercise data, total up the calories you’ve burned or steps you’ve taken, or even monitor your diet.
John Hancock offers a number of rewards — if you’re active enough — including an up to 25% discount on premiums. UnitedHealthcare offers credits for reaching fitness goals that can be used for out-of-pocket health expenses. Health insurer Oscar rewards its app users with $1 toward an Amazon gift card for each day they meet their fitness goals.
Last year saw a flood of requests for life insurance policies, for obvious reasons. If the pandemic has inspired you to follow suit, make sure you shop around to find the lowest rate, then do the same for your health insurance.
With free online services, you can review customized policies side-by-side, simply and quickly — and you don't even need to provide your daily step count.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.