PHILADELPHIA--(BUSINESS WIRE)--Record setting homeowner losses caused by frozen pipes in the winter months of 2014 for the insurance industry as a whole have added urgency to loss prevention efforts, including a renewed focus on encouraging homeowners to take advantage of policy benefits that help with the cost of installing appropriate safety systems, according to ACE Private Risk Services, the high net worth personal insurance business of ACE Group.
Damage from frozen pipes would have been almost eliminated if homeowners had installed a system that detects water leaks and automatically shuts off the water supply. These systems monitor water flow and will shut off the water supply when the flow exceeds a rate and period of time set by the homeowner. They are especially useful while the family is sleeping or out of the house, because even a small water leak can cause catastrophic damage in a matter of hours.
These systems typically cost a few thousand dollars to install -- a very worthwhile investment for the homes ACE protects, which tend to have an insured value ranging from $1 million to $10 million, and sometimes more. To encourage installation, most insurance companies offer a credit on the homeowner’s insurance premium when such a system is present. ACE Private Risk Services offers a credit of 5 to 7 percent, depending on the state. Unlike most homeowner policies, ACE’s policy also provides coverage for the cost of installing a water leak detection system after the home experiences such a loss. Nevertheless, many homeowners fail to take advantage of this benefit.
“We’re putting a renewed focus on communicating this benefit to our clients,” says Gary Raphael, Senior Vice President of Risk Consulting, at ACE Private Risk Services. “We’re enhancing the range of materials we have to communicate this policy benefit so that our agents and adjusters can keep the opportunity in front of the client. We’re also continually working with the process to make it easier for the client to act. Our preferred vendor can even make all the arrangements with the plumber, if necessary.”
Tony Guerriero, Vice President of Claims, at ACE Private Risk Services adds, “While our policy protects against financial loss due to water damage from a frozen pipe, there’s no getting around the hassle of having construction workers in your home cleaning up and making repairs. Repairs on a large home built with rare materials and high quality craftsmanship could take more than a year to complete.” Mr. Guerriero also notes the potential loss of irreplaceable items, such as historic family photographs, artwork, or heirloom furniture.
“And the beauty of a system that automatically detects leaks and shuts off the water supply is that it works for far more than frozen pipes. It works for any type of plumbing leak – a faulty toilet, a broken hose to the washing machine or refrigerator, a blown valve on a heating system,” says Mr. Raphael.
Indeed, an analysis ACE conducted in 2010 found that homeowners could eliminate up to $8.5 billion a year in property damage if they only deployed an automatic water leak detection and shut-off system to prevent or reduce damage from water.
Water caused $9.1 billion in annual homeowner policy property losses from 2007 to 2009 – approximately 23 percent of all homeowner property losses1. But up to 93 percent of the cost of water damage could have been prevented or minimized if an automatic water leak detection and shut-off system had been present in the homes.
“We’re glad to help our clients with the cost of installing such a system,” says Mr. Guerriero. “In the end, everyone wins when you can prevent or minimize damage.”
About ACE Private Risk Services
ACE Private Risk Services is ACE Group’s high net worth personal insurance business, which provides specialty coverage for homeowners, automobile, recreational marine, umbrella liability and collections insurance for financially successful individuals and families. Policies are issued by Bankers Standard Insurance Co., ACE Insurance Co. of the Midwest, and Atlantic Employers Insurance Co. Additional information can be found at:www.aceprs.com. ACE Group is one of the world’s largest multiline property and casualty insurers. With operations in 54 countries, ACE provides commercial and personal property and casualty insurance, personal accident and supplemental health insurance, reinsurance, and life insurance to a diverse group of clients. ACE Limited, the parent company of ACE Group, is listed on the New York Stock Exchange (NYSE: ACE) and is a component of the S&P 500 index. Additional information can be found at www.acegroup.com.
1 Based on a SNL data for total Homeowner property losses and ISO data for the percent of Homeowner losses attributable to water.
Contact:
ACE North America Communications
Carla Ferrara, 215-640-4744
carla.ferrara@acegroup.com