He explains the thinking behind it: “Patterns in people’s homes could indicate what may be going wrong. Every time we look at something new, as well as looking at cost and commercial benefits, we also analyse the ethics and privacy impact.” He adds that in the future it could be about care for the elderly.
However, what his firm finds most stimulating is the collation of data about irregular activities. This may include incidents such as power surges, floods, etc. The data from Internet of Things devices, such as for water leak detection, can be used to analyse both regular and irregular activities and incidents – allowing appropriate management decisions to be made to safeguard the built environment.
He explains why: “IoT is about connecting physical devices that generate data for a wider ecosystem. If you want to build intelligence into a structure, that has to require data and communication, and that’s what IoT is.”
“Leak detection is very much part of IoT, and with it we’re talking about physical devices that connect to other things, including places where the data can be stored, analysed and then trigger some kind of intervention”, he comments. Leak detection is therefore an important aspect of making homes and office blocks both safer and smart, while also adding a commercial and consumer leak detection benefit that can prevent damage to property, while also saving time and money.
“Escape of water events lead to major upheaval, such as flooding”, he reveals. However, while water leaks can lead to flooding, in the insurance industry they tend to refer to water leaks from pipes as being Escape of Water Incidents. Floods are defined as, for example, rivers breaking their banks. He says Escape of Water is the second biggest source of commercial insurance claims.
Laura Hughes, General Insurance Manager at the Association of British Insurers, says:
“Claims for water leaks are a growing concern for our members given the rapidly increasing cost of the average claim. This is largely down to the higher cost of repairing homes and businesses which are using increasingly luxury fittings. It’s also the case that homes have more water running around them than ever before, given the rise in the number of appliances using water and increased numbers of en suite bathrooms and shower facilities. The trend for boxing in fitments and pipes means the early signs of a leak can go unnoticed and more damage is done before a problem is detected.
“The ABI has been promoting advice to consumers on the importance of getting new appliances installed professionally and the need to investigate damp patches promptly. Insurers also encourage the use of leak detection devices which can be extremely effective at preventing damage. Again they need to be fitted by a professional but some insurers may offer help with this, and even take the presence of one of the gadgets into account when pricing cover.”
The cure: Prevention
Michael Wakley, CEO of water leak detection solutions provider Leaksafe, says the high cost of Escape of Water claims in the UK, over £930 million in 2018 according to the Association of British Insurers, is leading insurers to “actively encourage their policyholders to proactively manage risk in their properties.” This may involve the installation of a water leak detection system, and other means of protecting a property or a portfolio of properties from potential damage; such as fire alarms and gas leak monitors. In return, policyholders may benefit from reduced premiums, or a reduction of Escape of Water excess charges and progressively reduce these at renewal if no further claims are made.”
Wakley also clarifies why identifying water leaks rapidly is crucial: “In our arena, the quicker a leak is identified, the less damage and disruption is caused, at least cost to owners and insurers.Our LPWAN and Narrow Band Internet of Things (NBIoT) technology-based leak detection and Remote Risk Monitoring (RRM) systems will identify even a drip leak, and immediately notify owners or property managers of its exact location so that can act swiftly to prevent further damage.”
He elaborates: “Without the use of these technologies, leaks could persist for some time until they finally become noticed either visually or by odour, by which time significant damage may have been caused to the fabric of the building.The location-specific data Leaksafe’s RRM system provides, cuts down on the amount of time needed to investigate where a leak has occurred; and in most cases, when caught early, the cost of repairing the leak and reinstatement will be far less.”
The data emerging from NBIoT devices over low-powered wider area networks (LPWANs) can be incorporated in property owners, property and facilities managers own management and maintenance platforms. Wakley says this permits them to have a consolidated and co-ordinated approach to maintenance issues
Spotting patterns with AI and ML
As for the use of artificial intelligence (AI) and machine learning (ML), Machado reminds us that AI is a very broad term. ML is the biggest part of it, and it uses algorithms to spot patterns in data, which can be used to make interventions when something is going awry. He adds: “To us IoT and AI are two sides of the same coin. An IoT device generates data.”
“The analysis is the AI part of the process in the way that we analyse data. I think IoT devices need to be subject to the same scrutiny as anything else within your network. If you buy a random device online, you won’t have the assurance that they are safe from cyber-attack. We are extremely vigilant about it, and through testing we ensure that our devices meet the highest security standards.”
In his view artificial intelligence is a ‘catch-all’ term for automating process with algorithms. AI’s ability to analyse large amounts of data to spot patterns that may or may nor cause concern, or which may conversely highlight strategic opportunities, is disrupting many applications that have traditionally involved humans.
The use of IoT, AI and ML in the built environment will, in Machado’s view, lead to a drop in insurance premiums. He explains why: “The more data we have, the more uncertainty we have about outcomes. Insurance is about putting a price on uncertainty, the riskiness of it and the predicted outcome. If somebody intervenes and prevents a large loss occurring, that will make its way back into the cost of the insurance premium. Longer term, if we can feed into the design of the structures to make them more resilient, then we should be able to reduce losses without having to intervene.”
“Leak detection is but one example”, he says before explaining: “With a leak detector you will get an alert on your phone when something looks like a leak. In the future we imagine many more cases of automatic intervention to protect the property rather than having someone involved.”
Machado adds: “Aviva has a range of leak detection solutions through our Specialist Partner Network, which have the dual benefit of monitoring and helping reduce water consumption and alerting and preventing leaks.”
As an insurer he explains that the data emanating from IoT devices such as water leak detectors is used in the short-term to generate triggers and alerts. He hopes that the data will also have a long-term benefit, enabling Aviva to understand the “weaknesses in the design homes and offices to ensure they become more resilient by design”.
Wakley interjects: “The data from our IoT devices transmits over either a LPWAN or NBIoT network to a data platform that instantaneously transmits information and alarms to designated responders, and a record of all the events that have occurred is stored on a client dashboard”.He explains that this allows property investors, owners and managers to monitor and analyse a property, or portfolio of properties, “to identify those where escape of water is, or is becoming a significant problem.In new build projects this data is particularly useful as problems are identified within the construction defects period and therefore rectified at no cost to the owner.”
Case study: Student accommodation
He provides an example, involving a ‘new build’ of 271 room student accommodation.The property investor wished to protect this asset in an environment that is notorious for problems with leaks not being reported. As a preventative measure, and to eliminate this issue, water leak detection systems were installed around the hot and cold feeds to each student bathroom with immediate notification to the on-site management team if a leak was detected.
Wakley says the results included the detection of 24 leaks in the 16 weeks following the completion of the project by the main contractor.“All damage was contained below the insurance policy excess, and all rectified within the contractor’s defect period, and what’s more the system continues to deliver benefit month on month”, he explains.
Machado also sees IoT as being part of the evolution of businesses such as insurance. It is changing the insurance industry because historically insurance was about paying people money “when bad things happen.” IoT, AI and ML offer the opportunity to turn the traditional modus operandi on its head. The future, he predicts, will be more focused than it had been in the past on prevention – stopping bad things from happening in the first place. He therefore concludes: “This is good for us and for our clients.” Both parties now have the opportunity to save time and money by protecting their assets.
This can be achieved by making the built environment intelligent. Moreover, with a system such as Leaksafe’s remote risk monitoring in place, an auditable trail is created. Wakley says this shows “that post-installation of a leak detection system the number of claims as a result of leaks is either vastly reduced or eliminated.Building managers, investors and owners then have empirical evidence of the improvement in claims performance to present either to their existing insurer or to obtain alternative quotes.” So IoT data can lead to action, and with it the intelligent built environment is underpinned.
This article was written by Graham Jarvis, Freelance Business and Technology Journalist.