Smart Water Leak Detectors Cut Insurance Costs, Boost Financial Gains

In a climate of rising insurance premiums, there is a solution that is delivering impressive financial returns: smart water leak detection systems. "One of the buildings from last year actually saved $300,000 on their renewal," says John Rusk, president and co-founder of Pro Sentry. "Once they went back to the insurer and said, 'Hey, we know we had some leaks, but we put in this water leak mitigation system.' the insurer looked at it and ended up saving them $300,000."

The insurance benefits extend to individual unit owners as well. Chubb Insurance now offers an 8% discount on homeowner policies in buildings with comprehensive water leak detection systems. "Chubb Insurance offered a 3% discount for that and would offer an additional five if there was an automatic valve," explains Rusk. After demonstrating the effectiveness of the Pro Sentry system, Chubb increased the discount to a full 8% for buildings with 24/7 staff that can respond to alerts.

The technology itself is simple and unobtrusive, says Rusk. The basic sensor is "about the size of a popsicle stick" that can be placed behind toilets, under dishwashers, washing machines, and sinks. When moisture is detected, an alert is sent within seconds, allowing for rapid response before significant damage occurs.

Balancing the benefits against the cost, the system has a good ROI. Sensors cost about $75 each, including the network infrastructure, and monthly monitoring runs about $1 per device. For perspective, "a one-bedroom apartment might have five sensors, so maybe $350 for all the sensors for that one-bedroom apartment, and those are going to last 10 years," according to Rusk.

Beyond leak detection, the sensors also monitor temperature, providing an early warning system for frozen pipes — another major source of water damage claims. "We insist that all of our water leak detectors also do temperature monitoring, because it's so important," says Rusk. "If we can catch that pipe as it's coming down to 45 degrees and you stop that problem, you stop a water leak."

For buildings struggling with insurance renewals due to previous water damage claims, these systems could be the difference between securing affordable coverage or facing prohibitive premiums or even denial of coverage. Proactive risk management and water leak detection systems represent a rare win-win for boards: reduced insurance costs combined with significantly lower risk of costly water damage.