This week's newsletter is really just an excuse for me to share a cool story about sensors so tiny that they're being used to track the migration of hundreds of individual Monarch butterflies as they travel from Canada to winter in Mexico.
I've been banging the drum about the importance of ever-shrinking sensors since at least 2013, when Chunka Mui and I published "The New Killer Apps" and listed ubiquitous sensors as one of our six technology megatrends to exploit. I've been fascinated by Monarch butterflies since coming upon a traffic jam on a country road in Mexico in the '90s, stepping out of my car and realizing that the "leaves" on trees up the hill were actually millions of Monarch butterflies. So I just couldn't pass up this week's story of Monarchs being outfitted with sensors that include a solar panel, a battery, a radio, and an antenna--while weighing six-hundredths of a gram.
Oh, and there are plenty of implications for insurers, where ever cheaper, ever more powerful, ever smaller sensors are already enabling the move to a Predict & Prevent model and where, as the butterfly story shows, there is still loads of room for progress.
An article in the New York Times says about 400 butterflies have been fitted with the sensors and tracked, via a phone app, as they made their way south. Some were tracked for as long as nine weeks as they headed south to the winter colonies where they and their ancestors were born. One was tracked as it blew out to sea from Cape May, NJ, to the Bahamas and then flew west to Florida. As you might imagine, only about one in four survives the arduous journey.
Even at 60 milligrams, the sensors add 12-15% to a Monarch's body weight, and they aren't cheap; they cost $200 apiece. But Moore's Law has been taking care of size and cost issues for electronics for some 60 years now and let the inventors get the sensors to the point where they're practical. The inventors also took advantage of the billions of Bluetooth devices that are already out there: If a Monarch flew within 300 feet of a Bluetooth-enabled device, the device would pick up the butterfly's radio signal and share its location with the tracking app.
Moore's Law and the spread of "mesh" networks like the one Bluetooth allows the butterfly sensors to access will continue to benefit the Monarch trackers--and insurers that choose to take advantage.
Telematics in auto insurance shows what can happen as technology moves down the size and cost curves. When Progressive pioneered its Snapshot program in 2008, the company quickly gained market share, but success was limited by the fact that Progressive had to pay for dongles and that drivers would then have to figure out how to insert them under their dashboards. When motion sensors became cheap enough that they were routinely embedded in smartphones, Progressive rolled out an app that not only had almost zero marginal cost but that was super-convenient for drivers. Its market share soared from fourth among U.S. auto insurers in 2015 to second this year. Its combined ratio in 2024 was more than six percentage points below the industry average.
While other uses in insurance haven't had the same sort of dramatic success, some are getting there and enabling the move to Predict & Prevent.
Whisker Labs's Ting device, which plugs into a wall socket, has now demonstrated that it prevents so many home fires that more than 30 insurers are giving the device to customers for free. Water leak sensors keep shrinking in size and increasing in capability, to the point that some insurers are at least experimenting with giving them away to policyholders. Nauto's windshield cameras -- one pointed at the road, one at the driver, with AI monitoring and warning the driver of impending danger -- is reducing accidents by 60-70%-plus in truck fleets. Roost sells batteries for smoke detectors that contain sensors and communication capabilities so they can send an alert to your phone and let you know of a problem when you aren't home. Home security systems now let you just affix inexpensive sensors to windows and doors that can communicate wirelessly to you or a monitoring company, without all the wiring that used to be required.
FitBit, Oura and other fitness trackers are riding the sensor cost/size curves to keep adding capabilities. My first FitBit, which I bought maybe 10 or 12 years ago, just tracked my heart rate and my time sleeping. My Oura ring now tells me about my heart rate, my heart rate variability (which I didn't even know was a thing until Oura told me about it), my blood oxygen level, body temperature and more. Separate devices can track blood sugar, blood pressure, etc., and many of those sensors will find their way into the devices we wear on our fingers or wrists, much as motion sensors and so many other capabilities have been absorbed into our smart phones. That's just how technology works: Everything gets cheaper and gets absorbed into a dominant platform.
Insurers will also be able to benefit from the sort of "mesh" approach that the Monarch butterfly trackers use. The basic idea is that a device doesn't need to communicate directly with its host. It can just "mesh" with another device, which can then connect with the host or can even just keep passing along information to other devices (in this case, using Bluetooth) before reaching one that can connect with the host.
Bluetooth is available to insurers that want to collect a signal from a sensor in a home, in an office, in a factory, in a car, on a person, or whatever. Amazon also offers a mesh network called Sidewalk, based on Echo and Ring devices. If you have enough power to get a signal to one of the hundreds of millions of those devices, you can collect that information. There are surely other mesh networks available, too, if not on the Amazon or Bluetooth scale.
Cost and size will still be an issue for some potential uses of sensors by insurers, but today's issues won't be tomorrow's. Moore's Law will keep shrinking devices and slashing costs, so if you can see a plausible case for use of a sensor, you need to be thinking about what the capabilities and costs will be like a few years from now and, perhaps, start experimenting today.
The real issue is just one of creativity for the insurance industry: What information can we imagine gathering via sensor that will let us prevent or at least minimize a loss, so we can protect people and limit claims?
If we can track a single butterfly from New Jersey to the Bahamas to Florida, what can't we do?
Cheers,
Paul