Ondo InsurTech PLC (LSE:ONDO) said new research suggests the commercial return of its LeakBot technology for insurance carriers is twice what was previously claimed.
A study conducted by Consumer Intelligence found LeakBot, which is the company’s patented water pipe monitoring system that helps prevent water leaks from turning into insurance claims, can reduce the cost of water damage claims by up to 70%.
The gadget resulted in a 39% reduction in the frequency of claims, the research found, with the remaining claims seeing a 50% reduction in the severity of claims.
Across the 3,000 homeowners tested in three countries – UK, US and Denmark – out of the 43,000 homes on the platform, the average reduction in water damage claims spending was found to be 44%.
On average, it was calculated that a LeakBot, which can be self-installed by homeowners by clipping it onto their mains pipe and downloading an app, can save an insurer $140 of annual claims costs per installation, based on the average $200 claims cost per policy for water damage.
Ondo noted that the research also showed that customers who had been given a LeakBot device from their home insurer were 37% were more likely to choose to renew with their existing insurer than before receiving the device.
"We knew that LeakBot worked - now we know exactly how well it works,” said Ondo chief executive Craig Foster.
“This landmark research by Consumer Intelligence is what the home insurance industry has been waiting for - hard evidence that IOT-based systems can have a dramatic effect on claims costs and consumer loyalty, and can be deployed at scale with an immediate return on investment.”