Smart home insurance discounts are changing how homeowners protect their property and save money. Many major insurers now reward policyholders who install connected safety devices. These products help prevent water damage, fire, and theft before costly claims occur. As a result, insurance companies see fewer payouts and pass savings along to you. The Table of Contents
naic.org/article/consumer-insight-tips-saving-your-homeowners-insurance”>National Association of Insurance Commissioners (NAIC) recommends asking your agent about every available discount. Typical smart home insurance savings range from 5% to 20% on your annual premium. For a homeowner paying around $2,000 per year, that means $100 to $400 back annually. These savings grow further when you combine multiple qualifying devices under one policy.
Which Devices Qualify for Smart Home Insurance Discounts
Not every smart gadget earns a premium reduction. Insurance companies focus on devices that directly prevent the most expensive claims. Water leak detectors rank among the most valued by carriers today. Water damage causes billions in homeowner claims nationwide each year. A smart leak sensor alerts you to drips and bursts before they cause thousands in damage. For example, State Farm partners with brands like Flo by Moen and Phyn for approved water security solutions. Automatic shutoff valves go further by cutting water flow entirely when a leak is detected.
Monitored security systems also earn significant discounts from most carriers. A professionally monitored burglar alarm can reduce your premium by 5% to 20%. Smart smoke and carbon monoxide detectors qualify with many insurers as well. These devices send instant alerts to your phone even when you are hundreds of miles away. Smart thermostats round out the common list by preventing frozen and burst pipes during cold winter months. In most cases, the device must be actively connected and monitored to qualify for smart home insurance savings.
Video doorbells and smart door locks are gaining recognition from insurers too. These devices deter package theft and break-ins at the front door. However, not all carriers count them toward a discount yet. The technology is still newer to the insurance industry. Check with your provider to see if video doorbells qualify in your state. Smart home insurance programs expand their approved device lists frequently as adoption grows.
How Much Can You Save With Smart Home Insurance Technology
Savings vary widely depending on your carrier and the specific devices you install. American Family Insurance offers discounts through its connected home program for qualifying devices. Allstate policyholders can save up to 5% by installing approved smart cameras, leak detectors, or door sensors. Farmers Insurance offers savings between 5% and 20% for devices that protect against water leaks, fires, or theft.
However, some carriers provide even deeper smart home insurance reductions. Cincinnati Insurance gives 2% to 8% off for automatic water shutoff devices and centrally monitored alarms. Chubb offers up to 35% off certain comprehensive security packages. USAA runs a Connected Home program requiring at least two water leak detectors sharing data to activate your discount. The table below shows typical discount ranges organized by device type.
| Device Type | Typical Discount | Top Carriers |
|---|---|---|
| Monitored Security System | 5% – 20% | Farmers, State Farm, Allstate |
| Water Leak Detector | 2% – 10% | USAA, Cincinnati, Chubb |
| Automatic Water Shutoff Valve | 5% – 15% | State Farm, American Family |
| Smart Smoke/CO Detector | 2% – 5% | Allstate, Farmers |
| Smart Thermostat | 1% – 3% | Various carriers |
Stacking multiple devices can boost your total smart home insurance discount significantly. Some carriers cap combined savings at a fixed percentage. Others let each qualifying device contribute separately to your total reduction. Always confirm the maximum available discount with your agent before investing in new equipment.
How to Claim Your Smart Home Insurance Discount
Claiming your discount requires a few straightforward steps. First, contact your insurance agent or carrier directly. Ask which specific smart devices they recognize for premium reductions. Each company maintains its own approved list of brands and device models. For example, USAA accepts only Roost or Resideo leak detectors for its program. Typically, you cannot install any random device and expect an automatic discount on your policy.
Next, install each device according to the manufacturer’s instructions. Most carriers require professional monitoring for security systems to qualify. Self-monitored cameras alone may not earn any reduction at all. As a result, choosing a professionally monitored plan is usually worth the extra monthly cost. After installation is complete, notify your insurer and provide proof of active devices. Some companies verify coverage through app data sharing or a connected home platform.
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Finally, review your smart home insurance setup at each annual policy renewal. Technology changes fast and new discount programs appear regularly. The device you installed two years ago may now qualify for a larger reduction. In most cases, updating your policy takes just one phone call to your agent. The investment in smart devices often pays for itself within the first year through premium savings alone. Homeowners who bundle a security system with water sensors and smart detectors see the best savings on their smart home insurance policy.
Frequently Asked Questions
Do all insurance companies offer smart home insurance discounts?
Not all carriers offer these discounts yet. However, most major national insurers now have some form of connected device savings program. Contact your specific carrier to ask about available smart home insurance discounts before purchasing any new equipment.
How much does a smart home security system cost compared to the insurance savings?
A basic smart home security setup costs between $200 and $500 for the devices alone. Typically, the annual insurance savings range from $75 to $300 or more depending on your carrier. As a result, most homeowners recoup their full investment within one to two years.
Do I need professional monitoring to get the full insurance discount?
In most cases, yes. Carriers typically require professional monitoring for the largest premium reductions. Self-monitored devices may still qualify for smaller savings with certain insurers. For example, Allstate offers approximately 5% off for some self-monitored smart devices.
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Official Sources & Resources
For verified information on home insurance regulations and consumer protection:
- NAIC (National Association of Insurance Commissioners): naic.org
- Insurance Information Institute: iii.org
- FEMA (Federal Emergency Management Agency): fema.gov
- FloodSmart (National Flood Insurance Program): floodsmart.gov
- USA.gov — Housing: usa.gov/housing
Content last reviewed May 2026. If you notice any outdated information, please contact us.