Insurer XL Catlin’s venture capital arm is among firms helping to back a $10 million financing for Notion, an Internet of Things-related startup focused on a low-cost remote smart home sensor for home security.
XL Catlin’s XL Innovate, a previous investor, participated in Notion’s Series A round, along with previous investor Mesh VC and others. Draper Nexus and TransLink Capital led the new financing. Like XL Innovate, Liberty Mutual Strategic Ventures also participated in last year’s seed funding round for Notion.
In all, Notion has raised about $15 million since its 2013 launch.
The Denver-based company said it will use the cash infusion to expand existing partnerships with “three of the top five home insurance providers” it already has underway, in a bid to produce a “cost-effective loss mitigation system and home telematics” product. As well, Notion will pursue new relationships with other “leading property insurers,” it said.
Additionally, the financing will support product development and manufacturing, more marketing and hiring of additional staff focused on engineering, data science and marketing.
Notion’s initial product is a multi-function sensor that can identify temperature changes, water leaks, smoking alarms and the opening of doors and windows, among several other capabilities. Alerts can then be customized to be sent to Android or iOS smartphone. The company said that its sensor can take about five minutes to set up.
While traditional home security systems cost on average $2,500 over the required three-year contract period, Notion’s prices start at $129, and the system detects both unauthorized intrusions as well as water leaks.
Brett Jurgens, Notion’s CEO and co-founder, said in prepared remarks that the company was looking forward to working with its current and new insurance partners “to build more positive connections with homeowners and reward them with reduced insurance costs.”
Mitch Kitamura, managing director at Draper Nexus (and a new member of the Notion board of directors following the financing round), said that the Notion technology is helping insurers better engage with policyholders but also learn more about their behaviors.
“For insurance providers, installing Notion in homes across the country is simultaneously transforming the relationships they have with their customers – creating an opportunity for them to positively engage with their policyholders, and receive unmatched access into those behaviors and activities happening inside those homes.”
Martha Notaras, a partner at XL Innovate, serves on the Notion board of directors.
With sensors of various kinds in policyholders’ cars, homes and personal devices, “exposure data tracking” is becoming a competitive imperative in personal lines underwriting and rating.
Thomas Smith, founder and president of Senteri, a ﬁrm focused on smart-home services for P/C carriers, told attendees at the Casualty Actuarial Society (CAS) that more than 10 percent of homes in the U.S. are equipped with “smart” thermostats, lighting, door locks, and smoke and CO2 detectors, plus monitors for security, heat and water use. These type of devices have become standard features of newly constructed homes.
Major carriers, including American Family, Liberty Mutual and State Farm have developed service packages for automated home monitoring with an eye toward attracting new business, improving retention, reducing losses and accumulating data as an asset for underwriting and ratemaking.
Willis Towers Watson is partnering with technology firm Roost to establish a claims data sharing consortium to help insurers test the effectiveness of water and fire smart home technologies. The two companies said the consortium will be comprised of five to 10 U.S. insurance carriers. The aim is to help the property insurance industry take advantage of the Internet of Things.