WINT and HSB partnership a win-win across the board

WINT and HSB partnership a win-win across the board | Insurance Business America

Technology

WINT and HSB partnership a win-win across the board

The behind-the-scenes story of how a high-tech startup and insurance giant joined forces

Technology

By
Mallory Hendry

Have you heard the story of a high-tech water management solution startup that joined forces with an insurance giant? It was the beginning of a beautiful partnership.

In the midst of COVID-19, WINT Water Intelligence was approached by the Munich Re, one of the largest global insurance groups in the world. The insurer’s technology innovation team were asking to take a look at WINT’s technology. In the five years WINT has been in operation, it attracted a lot of attention for its cutting-edge solution. It made sense that Munich Re, early adapters of insurance technology who remain at the forefront of InsurTech advancement, setting the market standard when it comes to quality of product and dedication to transforming the industry through technological solutions, were drawn to WINT’s capabilities. In a nutshell, WINT provides an AI-based solution that uses real time water flow analysis to detect leaks and then shut off the water to prevent further damage.

“We’re doing this with high confidence and a very high success rate,” said Alon Geva, CEO of WINT. “Our technology allows us to be very, very accurate.”

Setting the stage

Geva and the rest of the WINT team didn’t know it at the time, but water leaks are also a major concern for insurance companies and are one of the biggest sources of losses on both P&C and Builder’s Risk policies. With annual costs of over $13B in the US and £1B in the UK, for example, insurance companies are either stepping away from covering liability of water incidents in properties or are raising deductibles significantly. It’s a pain point on both sides: insurance carriers are paying out billions of dollars in water-damage claims and on the customer side, deductibles have skyrocketed from $10,000 per event to upwards of $1,000,000 per event.

 “With those types of numbers, if a construction company with 20 running projects suffers from only a few water events, they’ll probably pay many millions in deductibles,” Geva said, adding he recently spoke to a customer who was asked to pay $2M per event. “When Munich Re approached us, they were looking for a solution to this burning issue.”

Beyond thoroughly vetting the technology’s performance — “Because of the pandemic, the engineer couldn’t come to our office, so he built his own testing lab in his house: I think he knows the system better than us, in terms of capabilities,” Geva laughed — Munich Re collaborated with WINT in a joint analysis of how its solution is helping customers in the real world. The results were staggering and WINT is very proud of this achievement, noted Geva.

“The study conducted by Munich Re found that when the WINT system is installed on a construction site, the number of water-related claims drops by 73%, and the average payout falls by a whopping 90%,” Geva said. “With water damage constituting approximately 30% of the loss ratio on builder’s risk policies, this has a real impact on the builder’s risk profitability.”

Following a lengthy technical evaluation process, Munich Re decided to move forward with WINT through HSB, its US based daughter company leading the deal.

A multi-faceted partnership

The partnership has evolved over time. In April 2023, WINT launched its HSB-backed performance warranty. Designed to mitigate the rising deductible in the builders’ risk market, the program covers water damage up to a quarter of a million dollars on WINT-protected construction sites. In other words – HSB’s experts trust WINT’s technology such that they will refund damages that WINT fails to stop. The high-traction program is helping developers and general contractors who are concerned about the rapidly rising cost of insurance and deductibles with exclusions specifically for water leak damage.

“The performance guarantee on WINT’s system demonstrates the level of confidence HSB has in our product, because they’re willing to warrant the damage value,” Geva said.

Following up on the performance warranty, WINT and HSB signed lately a distribution agreement, where HSB will resell WINT’s products directly to end customers as well as to other insurance carriers as part of HSB’s IoT technology package for risk mitigation. Beyond acquiring “an extremely capable distribution partner, this is a strong statement from a trusted insurance market player so we’re very excited about it,” Geva noted.

“While the cost of water damage continues to rise, water scarcity and water waste is a growing problem we couldn’t afford to ignore, in the context of climate change,” said John Riggs, chief technology officer and senior vice president of Applied Technology Solutions for HSB. “WINT’s water management solutions powered by Artificial Intelligence (AI) gives our clients a proven technology-enabled approach to help prevent water damage and water waste. It also assists them meet the ongoing challenges of protecting their investments and addressing water sustainability.”

In the construction world, it’s a well-known fact that the question is not if you’re going to be hit by a water leak, it’s when. These end-users can leverage the warranty to almost completely eliminate out-of-pocket expenses, including those high deductibles. Geva recently spoke with one of WINT’s biggest customers, a construction company out of Texas, who told him that “preventing the unknowns is one of critical in our business – so to a large extent I’m in the business of predictability. And that’s what WINT does, with the support of its partner HSB: provide a tool that allows us to run predictably.”

Water leaks causes direct damage, but it’s more than that,” Geva said. “There are factors you don’t get back from an insurance company, like the project delays, the legal fees, and the reputation. We’re helping safeguard against all those costs. Everybody has an incentive to implement such a system.”

A WIN(T)-WIN(T) for all stakeholders

WINT isn’t just a positive force in the realm of insurance. The company is focused on sustainability, with its AI and signal processing real-time monitoring identifying not only leaks but water waste as well, reducing consumption, lowering utility costs, and cutting carbon emissions. This environmental benefit brings a lot of value as the company holistically tackles water-related issues and reduced the carbon footprint of its users.

“We hear from customers that the lower bills are nice though the major concern was damage and restoration, whether it’s insurance related or self-cover,” Geva said. “But the fact that we now come with the strong backing of Munich Re and HSB, it doesn’t have to be this or that — they can save water, they can reduce their damage, but they don’t have to worry about paying high deductibles or even the hurdle of going through insurance.”

Geva sees this move as market-led because customers consistently report that their number one driver to install WINT is to go to sleep at night knowing their site is protected. And it’s just the beginning of what WINT plans to do as it embraces its market roll out across the board.

“We have a very unique solution, and we are a very fast-growing company,” Geva said. With over 400 leading global enterprises in their customers base, and $10’s of millions of dollars in potential damage prevention savings in 2023 itself, the future looks bright and leak-free according to WINT CEO.

“The insurance world is really a great driver for us and our partnership with HSB is taking our business to the next level. It’s a win-win for everyone.”

Photographer credit: Hila Kadi Krugman

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