August 5, 2019
The Future of Home Maintenance
by Andrew Wynn
The future of home maintenance will be provided by trusted parties, like insurers and lenders, with a vested interest in the home.
Like your health, your pets or your car, your home requires regular maintenance to keep it running smoothly and working properly. Homes that are well-maintained are safer, require fewer costly repairs and retain more of their value. Few will argue the benefit of a well-cared-for home, yet today’s owners are expected to know about and conduct their own preventative maintenance.
Homes are the typical American’s most valuable asset, and yet we don’t care for them as well as we care for our cars that cost a fraction of the amount. Homeowners are responsible for the physical management of their property, including regular/preventative maintenance, emergency repairs and improvements, all without the training or expertise necessary.
So what does this mean for the homeowner?
The lack of expertise and training results in routine maintenance and small issues going ignored and undetected until a major failure occurs and requires a costly repair. For example, cracked caulk around a window may not seem like much, but water damage could result in a $5,000 repair that could have been prevented by a $4 tube of caulk and a half-hour of time. The national statistic on the cash value of home maintenance states that, for every $1 that is spent on maintenance, up to $100 of repairs are avoided.
Americans spent an average of $9,081 on home services in 2018, and fixing damage, defects or decay is cited as a top reason. In many cases, small preventative measures can prevent outsized expenses (dryer vent cleaning preventing fire; dishwasher drain filter cleaning preventing flood). For example, 13% of home fires annually are caused by electrical system failures. When was the last time you checked your outlets or breaker panel?
The lack of preventative maintenance has a real impact on property insurers, as well. Issues like old and corroded water heaters, left unaddressed, have the potential to result in expensive insurance claims, not to mention a really negative experience for the homeowner. Moreover, consumers are starting to realize they aren’t the experts they need to be when it comes to their homes and are looking to their insurers to help given the aligned interests. Research shows that 34% of consumers would be willing to switch to an insurance carrier that offered preventative loss and protection services.
How can we reshape the future of home maintenance?
As our homes continue to get more complicated and we have less free time, it’s critical that homeowners ensure their homes receive the proper care. However, according to a recent study by Bankrate, the #1 frustration of millennial homeowners is underestimating the costs and the continuing responsibilities of maintaining their home. This frustration, coupled with the lack of expertise, shows us that the future of home maintenance will be provided by trusted parties, like insurers, lenders and others with a vested interest in the home.
What’s less clear is if carriers will be able to adapt to the change and offer their customers the services they’re increasingly expecting — either with their own offerings or by partnering with new companies in the insurance ecosystem. In the future, managed home services and connected devices will allow insurers to move from a reactive model to a proactive one so that they could detect problems before they pop up and result in preventable claims. If this approach is implemented, insurers could meaningfully manage risk as well as deliver a more engaging customer experience — helping bring one of the last major antiquated industries into the modern world. The adage holds true: An ounce of prevention is worth a pound of cure when it comes to home maintenance.