POSTS PORTFOLIO SEARCH SHOP
SEARCH
save money, utility costs

How is the Condo Insurance Market Changing?

By on

April 5, 2021

- save money, utility costs

The condo insurance market is undergoing dramatic changes.


Approximately 48% of insurance claims in the high-rise market are due to water damage, compared to 18% of claims due to fire and 4% due to theft. COVID is changing how our buildings are being used. Weather-related claims are increasing. Underwriters are changing their approach. As a response to all of these changes, rates are increasing. 

 

As the vast majority of insurance claims shift to floods, we are seeing the condo insurance market shift in response. Read more to learn about what some of these changes are.

Why is this shift occurring?

According to Canadian Underwriter, experts are blaming deteriorating infrastructure as a major factor in the increased insurance claims, pointing at aging and deteriorating pipes as a problem as water damage claims have almost tripled since 2013.

On top of increased claims, repairing the water damage is becoming more complex, driving up claims costs. Repairs need to be done with the correct new products, and tasks such as protecting against mold are more labour-intensive than they used to be due to the amount of infrastructure that needs to be replaced during the process.

How has COVID affected flood insurance claims?


With the pandemic keeping many businesses stay-at-home for well over a year now, high-rise buildings need to consider the effects of having large buildings empty in the long term. Pipes require winterization to prevent floods, and monitoring in case floods do occur. Water ingress – when outside water gets into a building – needs to be prevented, and the HVAC systems need to continue operating.

How are insurance companies changing?


Technological innovation is affecting how insurance underwriters work. Underwriters are on a path to becoming technological trailblazers, utilizing automation and leveraging technological tools to focus on higher-level challenges. Technology isn’t squeezing out underwriters, but rather a future tool that will be used to increase efficiency.

How are condos and tenants affected?


All of the changes above are affecting condo insurance, and the effects are directly affecting the condo owners. From 2019 to 2020, Ontario condo owners’ insurance rose by 8%. In Alberta and BC, the increases are even higher, at 20% and 18% respectively. 

Ontario’s increase is attributed to a condo development boom, which corresponds to more insurance claims. Furthermore, aging infrastructure is affecting rates as well, as construction flaws become more apparent and claims in one condo can affect neighboring condos. 

 

Lastly, severe weather events are occurring more frequently due to climate change, which can also affect condo insurance claims. Claims related to severe weather events reached $422 million nationwide in 2008, and $2 billion nationwide currently. 

 

Claims made by the condo can increase insurance premiums, and the condos may pass these increased costs onto tenants through maintenance fees.

 
The insurance market is changing rapidly, and one of the best ways to protect your building and lower your rates is to invest in a water risk mitigation system. Contact us today for a quote.
Sincerely,
The Connected Sensors Team
0
Instruction, Power, utility costs

What’s the Life Expectancy of Your Product?

By on

March 29, 2021

- Instruction, Power, utility costs

A client of ours, who is getting ready to deploy hundreds if not thousands of sensors across their portfolio, came to us with this very valid question: 

“What’s the life expectancy of your products and solutions both from a maintenance and product replacement stand point?”

What the client was looking for is to understand what they were committing to in the long run and what implications this would have on their operating budget annually for the foreseeable future.

To better understand the different elements to be factored in to the life cycle cost of our solution we’ve broken it down in two categories: maintenance and product replacement cost.

Maintenance Cost:


When it comes to the maintenance cost of our solutions, there are two factors to be considered.

Battery replacement:

Rest assured that we thought of you building operators and managers and built a suite of products that work with three 3.6V batteries to give the best possible battery performance. Now what does that mean? It means our battery operated products, depending on the use case, have a life expectancy of 10 to 15 years. We estimate that the battery replacement cost per device will be in the range of $15 to $20, assuming the batteries don’t come down in price over time. We invite you to also review this other blog we’ve written to better understand the implications of choosing the right product so that you are not constantly worrying about replacing batteries.

General maintenance cost:

Outside of the obvious battery replacement cost, the only other factor to consider is the maintenance cost of the solution in the event the communication system goes down locally or on premises. Here is what we’ve done on the backend to ensure the system goes un-interrupted:

  • Our devices will dynamically change their data rate to reduce the amount of airtime and transmit smaller data packets. The smaller the message packet, the less data that must be transmitted via LTE. Which means less chances of issues occurring.

  • From a gateway perspective, the gateway has a functionality that allows us to submit a so-called “whitelist” to the local memory on the gateway. This avoids other LoRaWAN compliant devices to use your gateway as a generic bridge to get out. In a normal system, the server decides if the node/sensor that is received belongs to the application or not. Having a whitelist means the rejection of unwanted devices happens on the gateway, so there is no need to forward the packet in the first place. Once again, less interference and interruption means better reliability of the network.

  • Our gateway also has a memory and backup battery. These gateways are time sync enabled, meaning they can store messages locally and forward them if network coverage is interrupted for a period. This feature is aimed at removing any blank gaps in the history of the system.

  • Once the network is running and LTE communication is established, we use a network monitoring tool called “The Pinger” . This software polls the gateways via the LTE network to make sure it is running reliably. This allows for real time intervention when a gateway no longer responds, and automated messages get sent to the person responsible for that building/gateway.

  • The “Pinger” software is currently used on over 4500 live LTE connections and is manned 24/7 by a team in South Africa. We can make this option available to you, the customer, for the most responsive system possible.

    To conclude, we don’t envision many communication problems as we’ve done extensive work to mitigate that risk for you; however, it would be prudent to allocate a small budget for a few contractor truck rolls per annum to be on the safe side of things.

     

    Product replacement cost:

     

We will break this section down in 2 segments, the first being our warranty versus what we expect from the product.

Product warranty:

Like most electronic products sold, we have a 2 year/24 months warranty on the product. This means if, for any reason, a product would require replacement after that period of time, the client would be responsible for its replacement cost.

Product expectation:

While we advertise a 2 year or 24 months warranty, the product was built and designed to last the test of time. We believe that the lifespan of this hardware will extend the span of the software agreement several times over. Before making it to you, the end user, the product is tested 3 times in the factory, and depending on the installation package you’ve selected, the product will have been tested a 4th time on site before it’s handed over to you. 

We hope that our perspective can help you make a better informed decision as it relates to the long term capital commitment involved in owning a water management solution. If you have any questions or if you think we’ve missed something you would have appreciated us touching on, please do not hesitate to send us a message and we would be happy to discuss with you and your team.
 
Sincerely,
The Connected Sensors team
0
Sub Metering, utility costs

How Much Water Do We Use?

By on

March 26, 2021

- Sub Metering, utility costs

If you want to save water through a flood management system, you may be asking yourself: how much water does my commercial building use? How about my home?

Here are a few usage facts that may shed some light onto this question.

Water Usage in Commercial Buildings


According to RealPac Canada, the best practice range for water usage in the commercial sector is 12 to 50 L/ft2/yr. “If every building in the study met the high end of the proposed Best Practice Range (50 L/ft2 /yr), a potential savings of 2.5 billion litres would be possible in Canada. In Ontario alone, the savings would total 1.6 billion litres, and indirect greenhouse gas (GHG) emissions reductions could total 240,000 kgCO2e/yr as a direct result of the reduction in energy needed to pump and treat water.”

It’s estimated in commercial buildings that each employee uses 59 litres per employee per working day, though the amount varies based on the age of the building and the climate at its location.

Water Use at Home


In Canada, our average use per capita is 251 liters, which is one of the highest in the world. In the average home, 65% of this occurs in the bathroom, 10% in the kitchen, and 20% in laundry. In comparison, the US’s average usage per day is 60 gallons (227 Liters). This is broken down into 64 gallons (242L) in the bathroom per household, 29 gallons (109L) in the kitchen per household, and 18 gallons (64L) of leaks! A leaking toilet alone can waste up to 200,000L per year.

In older homes without high-efficiency appliances, usage is higher. Older shower heads can use 20L of water per minute, while new showerheads cannot exceed 9.5L of water per minute.

Significant amounts go into each load of laundry. Each load uses 94L, compared to a shower using an estimated 40L and a dishwasher load using 23L.

If you are a condo building owner, these numbers in each individual condo unit add up quickly. In some cases such as in the City of Ottawa, municipalities are moving towards a tiered system for water billing, which may base charges off of bulk meters. It is important to closely monitor your water usage to keep your bill down. Submetering is also an option to transfer the costs of water to tenants. 

In conclusion, hydro bills add up quickly, and it’s important to monitor each area of consumption to reduce your overall use.

 

Sincerely,
 
The Connected Sensors team

 

0
save money, utility costs

What is the ROI of a Leak Detection System?

By on

February 17, 2021

- save money, utility costs

When speaking with prospective clients, we often get asked if we can quantify the Return on Investment (ROI) of a Leak Detection System. 

While there is no simple formula to calculate the ROI of a Leak Detection System, we will do our best to cover all the elements that can impact the ROI of such an investment while also sharing why we believe that such systems should be implemented for the purpose of good governance and risk management.

To better understand the need for such an investment, we have broken down our analysis into two segments. The first segment is focused on insurance and risk while the second segment is focused on operational advantages.

Insurance and Risk:


When it comes to insurance and risk, the first part is to identify the likelihood of water loss within the built environment.

After extensive research yet limited data points, we have found that according to this article published in the Canadian Underwriter, condos have more than a 30% chance of making a claim each year. While we encourage you to come to your own conclusions by using your own data set, one could assume that similar ratios would apply to multi-residential rentals and commercial high-rise.  In addition, according to this study from the Canadian Institute of Actuaries, water damage represents 48% of the claims, making water the most common cause of loss within the built environment. By utilizing the above 2 statistics, one could expect that condos, if not all high-rise buildings, have approximately a 14% chance of making a water claim each year or once every 7 years. 


The second part is to evaluate the “size and/or magnitude” of this risk.

When evaluating the magnitude of this risk, you should take into consideration the ever increasing costs of insurance, your insurability, the size of loss, and the deductible payout in the event of a loss.

 

Insurance costs:

 

This recent Canadian Underwriter article indicates that while insurance costs have been on the rise now for a combined 13 consecutive quarters, there is no end in sight. For property owners and managers, this means that you need to continue to put energy in making your risk management more attractive to underwriters to ensure that insurance capacity can be carved out for your book of business at competitive market rates. As indicated in the above section, since water is the most common cause of loss within the built environment, it is only good governance to implement some form of water risk mitigation to appeal to the underwriter. In some market segments, the industry has seen insurance costs spike as high as 780% making it impossible for the landlord or condo board to recoup such an expense. 

 

Insurability:

 

Given this hard insurance market and the capacity reduction resulting from the exit of many underwriters within the Commercial Property Insurance space over the last few years, property owners and managers have limited – if any – options when it comes to insurance. Some have even been denied coverage. Differentiating your risk profile can help create capacity and give you a competitive advantage in this market.

 

Size of Loss: 

 

As it relates to water claims within the built environment, many articles have been written using different data points which identify that the average size of a claim ranges from $150,000 to $250,000. More importantly, it has been found that the cost incurred for such losses have increased by 400% over the past 10 years. Leveraging technology such as Flood Mitigation Systems to reduce the size of a water loss is a great way to reduce your loss impact.

 

Deductibles:

 

Another very important element to consider is the size of your deductible. Over the last few years deductible payouts for some, if not most, have increased from $25,000 to $250,000 and even up to $500,000. What we have seen happen here is that the underwriters have effectively passed on the risk of claims beneath the deductible threshold to the property owners and managers. One can say that these property owners and managers are now self-insured until they reach a claim that exceeds the deductible payout, which may never happen if you are one of these individuals with a $250,000 to $500,000 deductible. 

Operational advantages:


Flood savings:

Some of the obvious benefits & savings that come from installing a Flood Mitigation System include avoiding: 

  1. Costly downtime from infrastructure repairs

  2. Clean-up, remediation, and restoration of such incidents

  3. Removal of hazardous materials such as asbestos

  4. Tenant disruption and displacement

Some less obvious yet important advantages include:

 


Maintaining building Integrity

Often times when a leak happens, it can go unnoticed for a long period of time, which can deteriorate the integrity of your building’s infrastructure over time. By installing a flood mitigation solution, you can monitor the leaks inside your property and take immediate action when notified. Over time if your asset/building has been well attended to, your property can fetch a higher valuation than a comparable asset nearby that may be distressed due to damage over the years.

Automated Asset Protection:

Managing, maintaining, and monitoring a multi-story high-rise can be a laborious and daunting task. By leveraging technology such as a flood mitigation system to automate such arduous tasks, it can help reduce operational and payroll expenses.
 

Preventive maintenance and contractor truck roll:

By leveraging technology and installing a smart flow monitoring device as part of your Flood Mitigation System, you can effectively identify small leaks such as toilet and faucet repairs, issues with blow down cycles, and many other problems that can go undetected for long periods of time. It is estimated that 85% of properties lose 35% of their water due to leaks. As such, you can effectively reduce your contractor truck roll generating operational savings while also creating a preventive maintenance schedule that suits all stakeholders involved in managing and maintaining the property.

Leveraging Data Analytics: 

By installing a Flood Mitigation Solution as part of your building, you can take advantage of the data aggregates that come from such a solution. For example, if multiple leaks have been identified on a riser over the last few years, this may be a great time to budget for a riser replacement in the next fiscal year. 

Other operational advantages include:

  1. Decreased water expenses

  2. Reduced energy consumption

  3. Better budgeting 

  4. Improved environmental impact

  5. Help achieving bold sustainable goals

We hope that our perspective on the ROI of a leak detection system can help you make a better informed decision as to whether or not a Flood Mitigation System should be part of your investment roadmap or not.  If you have any questions as it relates to the advantages of such a solution, please do not hesitate to send us a message and we would be happy to discuss with you and your team.
 
Sincerely,
The Connected Sensors team
0
save money, utility costs

Will a Water Risk Mitigation System Affect My Insurance Cost?

By on

February 17, 2021

- save money, utility costs

If you’re considering a water mitigation system for your building, one of the most pressing questions you’re asking is probably: will a water risk mitigation system affect my insurance cost?

The short answer is: yes. 

But there’s more than one way that a water mitigation system can affect your insurance cost.

Reduced Chances of a Claim

Currently, multi-residential high-rises have a 30% chance of making a claim each year, and 48% of those claims are due to water damage.

 

This greatly affects all stages of building and operating a multi-residential high-rise. 

  1. At the building stage, 10% of builders can’t get insurance.

  2. At the operational stage, insurance premiums are rising by up to 780% and deductibles are increasing to $500,000.

  3. The average claim cost due to water damage ranges between $150-$250k, affecting your premiums and resulting in facility down time. 

 

By setting up a water mitigation system for the purposes of early flood detection, you decrease your chances of needing to make a costly and time-consuming insurance claim.

Reduce the Chances of an Uninsured Incident

Unfortunately, not every water damage incident is covered by a condominium corporation’s insurance. Your insurance provider will be able to provide the details of your coverage for you. 

 

In some cases with condominiums, the owner may be responsible for the cost of the insurance deductible. The flow chart below summarizes the differences between insured and uninsured claims.


You can also read more here.

How Connected Sensors Can Help You


By preventing floods through monitoring systems, Connected Sensors can help you reduce the chances of costly deductible payouts.

 

Furthermore, we have partnered with NFP Insurance to offer long-term cost savings to insurance by potentially helping you save on front end premiums. 

 

We can also help you incorporate submetering to lower your water cost further by charging expenses back to tenants, or save on overall water cost by identifying leaks. 

 

In summary, a water risk mitigation system can affect your insurance cost, as well as overall cost, by:

-During the building phase by decreasing the chances of remaining uninsured

-During the operational phase by decreasing costly deductible payouts and potentially lowering your front-end premiums

-As part of day-to-day operations when used in conjunction with submetering

 
If you have any questions about how we can help you save on insurance costs, be sure to contact us.
 
Thank you,
 
Your Connected Sensors Team


 

0
Instruction, utility costs

How Can I Reduce My Risk of a Leak With My Fan Coil System?

By on

February 12, 2021

- Instruction, utility costs

If you are reading this, then I suspect that you’ve been the victim of a leak or flood that was the result of a faulty Fan Coil System. Let’s take a few minutes to explain what a Fan Coil System is, why they are such a high risk in your building, and what you can do to reduce your risk and exposure.


What’s a Fan Coil Unit System?

Fan Coil Units (FCU) are used to condition the local air to match the temperature requirements for an area in all types of buildings including commercial and multi-unit residential spaces. An FCU can contain an Air Handling Unit system (AHU) that supplies and returns fresh air around the building to all the rooms/units. The FCUs are connected to either a heating coil, a cooling coil, or both a heating and a cooling coil which will condition the air. A fan within the fan coil will then push the air out into some smaller localized ducts to strategically distribute the air within the room. Fresh air from the AHU is pushed into the back side, the inlet, of the fan coil unit, and a fan will suck the fresh air into the FCU. The fan will force the air across the heating and/or cooling coils before forcing it out into the area. The air will then take one of two routes: 1. It will be sucked into the return grille and be sucked back into the AHU via the return duct 2. It will be pulled back into the fan coil unit through a grille.

To learn more about the differences between Fan Coil Units and Water Source Heat Pumps, read our article here. 

Why are Fan Coil Units such high risk?

The coil heat exchangers will typically utilize a hot and/or chilled water supply which is distributed from the building’s boilers and chillers. That said, electrical heaters can be used for heating purposes and some coils use a direct expansion coil fed by a refrigeration system for cooling. If your system utilizes hot and cold water supply, this is where the risk comes into place.

Summer risk: You should keep an eye out if a cooling coil is used, as it can generate a lot of condensation where the warm moist air is condensing onto the cold surface of the coil. The cooling coil will remove the moisture from the air. This condensed liquid will run off the coil and collect in the drip tray at the bottom. The problem here is that in some cases the condensation (water) finds its way out of the drip pan and causes a leak that often goes unnoticed for long periods of time. In addition, a drain line from the pan is supposed to be connected to a nearby drain in theory; however, in many cases the drain line does not lead to a safe location that prevents potential damage.

Winter risk: You must keep an eye out for pipe bursts. In older buildings, the fan coil units were placed on the exterior walls. What we often see happening when a cold front settles in is some pipes burst as a result of a frosted line, which can cause significant damages. Pipe burst usually causes one of the largest losses from a dollar amount as it relates to leaks in the built environment.  In addition, older buildings and the hot water lines coming from the boiler over time erode and we have also seen pin holes occur.

All year round risk: You should always make sure to retain a qualified and reputable water treatment company that can offer a long term program where they test, track, and produce monthly records of your water and the glycol levels within your heating and cooling system to ensure longevity and integrity of your pipes. We’ve often found builds where the glycol levels were left unattended for long periods of time, corrosion was created within the system which created major infrastructure problems that resulted in leaks of all sizes. Following these, the necessary replacement of risers becomes inevitable.

How to reduce risk:

  1. For new buildings, start by ensuring the fan coil units are closer to the center of the building than the exterior walls.

  2. Install leak sensors in the drip pan to detect accumulation of water in the drip pan before it’s too late.

  3. If you are in an older building or newer building where the fan coil units are near the exterior wall, ensure that your leak detection system can also monitor temperature and give you early warnings of frost so you can install temporary heaters or add insulation where possible.

  4. In addition to leak detection sensors in the fan coil units, we also recommend installing leak detection sensors that come with a rope around the risers of the two pipe systems to detect pinholes or pipe burst.

  5. As discussed, retain a reputable water treatment partner that will ensure the integrity of your heating and cooling system.

  6. If you want to go the extra mile consider installing powered shut off valves to compliment the leak detection so that the water can be turned off if a leak within your system is detected.

 

As always, please don’t hesitate to reach out if you have any further questions as it relates to fan coil unit systems and the risks that are involved with them.
 
Sincerely,
Your Connected Sensors Team.


1
Instruction, save money, utility costs

How Much Does a Commercial Leak Detection System Cost?

By on

February 10, 2021

- Instruction, save money, utility costs

This is always one of the first questions a potential client wants to know when they reach out to us. While the question of “how much does a commercial leak detection cost?” is a very challenging one to answer, we will try our best to explain some general pricing guidelines.


The purchase of a Water Risk Mitigation System is much like the purchase of a vehicle or even a home. With so many options available, price ranges can vary significantly.

Just as a car can start around the $20,000 range with just a basic package, that same car can often exceed the $40,000 range if you start to add all the bells and whistles.

Given that most people change cars every 5 years or so, why do people still choose to purchase the extras when purchasing a car? It’s because in general, people understand the value of doing things right the first time and not having to redo things later down the road. People want to make sure their vehicle will provide them quality, longevity, and ease of use and those same principals apply to a Water Risk Mitigation System.

You are going to rely on your Water Risk Mitigation System to provide valuable insight of your water risk every minute of every day for as long as you can foresee. It is therefore critical to ensure you receive maximum value and minimum maintenance from your investment.

However, some companies choose to focus on the initial price of the system with the goal to find the cheapest vendor therefore sacrificing low-maintenance, quality, and warranty which more often than not leads to regrets – especially considering that unlike cars, you cannot trade in your Water Risk Mitigation System.

To simplify the system architecture, we have segmented the project types into 3 main categories: Retro-fit Market, New Buildings & Construction Phase. Under each of these segments we have created sub categories labelled as: Good, Better & Best Option to help our clients understand what and where we perceive value. 

How much does a commercial leak detection system cost
Average Commercial Leak Detection System cost based on a 100 unit Multi-Residential Property over a 5 year period of time:
How much does a commercial leak detection system cost

How the installation affects the cost:

When someone inquires what is our Commercial Leak Detection System cost, the extent of installation is also a key factor. What we mean by this is that as a company, we have four different packages we offer our customers. Unlike most companies, we will do as much or as little as our customers would have us do. This flexibility leads to less stress and more savings for the customer. 

 

The installation packages are as follows with their corresponding price ranges:

1. Self-Install (DIY):

This package includes the system and features to be shipped directly to the property. With our self-install program the property manager or building owner  is responsible for all labor involved with the project, including deployment of the sensors, setting up the gateways, commissioning of the sensors on the platform, installation of electrical outlets as required, installation of valves as required, etc.

Although the concept of installing a Water Risk Mitigation System is not very complex, it does require some attention to detail and there is a small margin for error. We recommend self-install for larger companies with facility managers and/or subject matter experts on staff that can be dedicated to the install of such solutions. 

The average company can expect to spend between 5 -10% of the value of the system on a self-install, based on the scope of the project and the options that come with it.

2. Pre-Configured Install:


This package includes the system and features to be shipped directly to the property, the sensors to be pre-configured on top of our dashboard, and the valve & actuator locations to be labelled and ready for your mechanical contractor to price and install. 

The property manager or building owner is responsible for the labor involved with the project, including deployment of the sensors and gateways, contracting out the installation of electrical outlets as required, installation of valves as required, etc.

The average company can expect to spend between 10 – 15% of the value of the system on a Pre-Configured Install, based on the scope of the project and the options that comes with it.

3. Connected Sensors Tech Install:


This package includes the system and features to be shipped directly to the property, the sensors to be pre-configured on top of our dashboard, the valve & actuators locations to be labelled and ready for your mechanical contractor to install, and the sensors, gateways and actuators (if applicable) to be installed by our team of experts or contractors. 

The property manager or building owner is responsible for the labor and parts cost of 3rd party contractors, such as the electricians and the plumber for outlets and valves etc.

The average company can expect to spend between 15 – 20% of the value of the system on a Connected Sensors Tech install, based on the scope of the project and the options that comes with it.

4. Turn-Key Install:


Many Property Managers would rather work with one company instead of many. We at Connected Sensors are one of the few companies that will offer our clients true “turn-key” installations. This package includes everything found in package #3 as well as the electrical and mechanical costs associated with the project.

The average company can expect to spend between 20 – 30% of the value of the system on a Turn-Key install, based on the scope of the project and the options that comes with it.

We hope that this article has helped you gain insight on the commercial leak detection system cost. You can visit our pricing page for further details or simply reach out to us using the “Request for Information” feature on our website.
 
Thank you,
The Connected Sensors Team
0