Another area of interest is home security, which today often involves monthly contracts. Reed said the company now believes it's possible to lower to cost of security systems with automated alert systems.
Connecting various systems in a house creates opportunities for new ideas.
For instance, if a smoke detector goes off, an application can be designed to alert the fire department as well as make front porch lights flash. All of this requires an ability to bridge different communications protocols and wireless technologies.
One potential technology approach is offered by Revolv's hub, said Reed.
Revolv makes a hub with seven wireless radios that support 10 or more wireless protocols. The supported protocols include Z-Wave, Insteon, WiFi, ZigBee, two 915 MHz radios that work with proprietary systems, and 433 MHz, which is used by a lot of security systems, said Revolv CEO Tim Enwall.
"We are in business to bring smart homes to any homeowner that wants them," said Enwall. Revolv's system will allow vendors to develop applications that can work with other devices that communicate through its hub.
Reed believes American Family's involvement may help accelerate home automation adoption. It expects to encourage adoption by covering at least some of the cost and hopes to work with some startups and policy holders who opt-in as early adopters.
"That's the economic angle that we hope to bring to this space," said Reed. If insurer can offset claims expenses by subsidizing some of the deployments of new Internet of Things technologies, "then everyone wins," he said.
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