The home emergency cover helps in dealing with and pay for an emergency at home. When a claim is made, an engineer or electrician will visit, and the insurer will pay for their work. Home emergency insurance cover will have policies that vary depending on how much a client pay and the level of cover provided. Insurance companies examine risks by greatly examining a large volume of granular data. Hence big data refers to the massively increasing volume and granularity of data sets that are being assessed and linked. Therefore, insurance companies can compile and analyze the data sets to examine a large consumer pool and how they price risk (Billot et al., 2018). This will have an impact on the cost and availability of insurance for all consumers.
With big data, Big home emergency insurance companies like Prominence Support and British gas will be able to draw more information about the equipment and resources within an individual home. Therefore, the company will understand the risks to which the insured is exposed and share findings with the customers to mitigate them. With tailored information from the insurer, customers will get signals about how to minimize home emergency events and reduce their risk levels and insurance premiums.
Mostly some damages at homes result from human interruptions; therefore, big data will provide a greater premium dispersion to price more preciously, ultimately down. Here, the big data will lead to a broader spread of the premiums between the human-caused and nature-caused damages. There are insured who will enjoy low premiums while others will pay high for a home emergency cover that in some cases may be unaffordable or even unavailable, and have the cover; then a certain behavior should be modified (Berthelé, 2018). Therefore, the insured will put more effort to change behaviors that may lead to home emergency events. This reduces the risks as well as the cost of insurance cost.
Berthelé, E. (2018). Using big data in insurance. Big Data for Insurance Companies, 131-161. https://doi.org/10.1002/9781119489368.ch5
Billot, R., Bothorel, C., & Lenca, P. (2018). Introduction to big data and its applications in insurance. Big Data for Insurance Companies, 1-25. https://doi.org/10.1002/9781119489368.ch1