Leak detection technology is already assisting major insurers in preventing claims, but the Geo Waterlock device allows brokers registered with BIBA to provide the same benefits to their clients
Brokers now have access to technology that helps prevent water leaks – giving the insurance industry hope it will reduce the number of claims for damage.
The Waterlock device is attached to a pipe and can automatically shut off the main water valve in a user’s home if it detects a leak, while it can also be turned off remotely via a connected app.
It has been created by environmental technology company Green Energy Options (Geo) and will be sold to policymakers through a scheme between the British Insurance Brokers’ Association and home cover specialist Magenta Insurance.
BIBA’s head of technical services Mike Hallam said: “Escape of water (EOW) is a peril that costs the industry millions of pounds, so we are delighted to be working with Magenta on a way to address this.
“Giving our members the opportunity to use cutting-edge technology for the benefit of their customer shows how close collaborations can lead the way in insurance solutions.
“BIBA’s 2019 manifesto includes commitments to help members make use of fast-moving developments in insurtech and innovation, and this new scheme is one way to fulfil these.
Cost of water damage claims to insurers
According to the Association of British Insurers (ABI), the insurance industry pays out approximately £2.5m every day to customers who have made “escape of water” claims on their home insurance.
Both Allianz and Aviva, two of the largest UK insurance companies, cite water leaks as the most common culprit for a claim on their home insurance policies.
Catherine Bell, chairman of Inet3 Group, parent company of Magenta Insurance, said: “EOW is much more disruptive and distressing than policy holders realise, until it happens to them.
“It can turn lives upside down, and while insurers can replace possessions and repair homes, they can’t protect against many other consequences, like replacing memorabilia, photos and treasured items.
“They also can’t remove the inconvenience to living your daily life during the repair, which further compounds the stress experienced when your home is flooded.”
Waterlock device rivals HomeServe’s Leakbot
A plethora of devices have been developed recently to address the large-scale issue of escaping water, with the technology coming from established firms like HomeServe, as well as start-ups such as Hero Labs – a company launched by the co-founder of smart-home insurer Neos.
Hero Labs’ Sonic device offers a similar function to the Waterlock but doesn’t launch until August this year.
HomeServe’s Leakbot was an early mover in developing leak-detection technology, and as such has already formed numerous insurance partnerships, providing its product and emergency repair services to Aviva, RSA and Legal & General.
With this latest move, Geo hopes to challenge Leakbot’s position by courting the broker market through the new scheme with Magenta.
The firm is also targeting the wider insurance market through a trial started in February this year with an unnamed major insurer.
Geo CEO Patrick Caiger-Smith said: “There are some obvious cost and hassle saving benefits to consumers using Waterlock, however, we have also designed the solution very much with the insurance industry in mind.
“The constant, connected risk assessment and data gathering that goes hand in hand with Waterlock means that the incidence of damage from water loss is vastly reduced.
“This, in turn should reduce risk for the insurer and lower premiums for the customer.”