This article was written by Daphne Tomlinson, Senior Research Associate at Memoori.

Alliances between smart building solution providers and Insurance companies are enabling improved building performance through predictive analytics and insurance-backed guarantees.

Three examples from early innovators described in this article reduce the risk that a company takes when deploying a new technology and may help to accelerate the slow adoption of IoT driven solutions in commercial and industrial buildings.

An Anglo-German partnership between Learnd Ltd, one of the UK’s largest systems integrators and two German partners, Munich Re, one of the leading speciality insurance providers and relayr, a Berlin based IoT firm, was announced in December 2020.

Learnd has launched its ‘Building Performance as a Service’ offering, suitable for any sector that operates commercial premises including critical infrastructure, healthcare, retail, education, government and business offices. Learnd, based in London, UK, is a technology-led integrator partnering with manufacturers of building management systems (Siemens, Tridium, Schneider Electric, Trend) with 90 field-based engineers, a Remote Operations Centre (ROC) managing over 1,800 sites and over 150 staff in total,

Relayr, an emerging technology partner with learnd, provides the data and analytics capability required to deliver better buildings for learnd’s customers. Relayr was acquired by the Munich RE group in 2018. HSB, also part of Munich RE is partnering with learnd to provide insurance-backed guarantees for the Building Performance as a Service offering.

The Learnd group has been augmented by three acquisitions since it was founded in Jan 2020: WEMS, a Manchester, UK based manufacturer of a wireless building energy management system; Aimteq, a UK firm specialising in the installation, maintenance & monitoring of BMS and BEMS equipment; and Comfort Controls, a systems integrator based in the south east of England. The group is majority owned by a prominent German entrepreneur, Florian Fritsch, who was also an early investor in the seed funding of Relayr.

Augury's Guaranteed Diagnostics offering was launched in June 2020, also through a partnership with HSB, a Munich RE company. This AI warranty is one of the first of its kind in the predictive maintenance field.

Guaranteed Diagnostics has two main components:
1. Halo is an artificial intelligence-based hardware and software solution sold as a subscription model per machine. The Halo device attaches to a machine and continuously monitors vibration to determine its health over time, enabling predictive maintenance and reducing unplanned downtime. Through a Web interface, machine operators can obtain information on the condition of their equipment, and receive alerts if the Halo device senses a drastic change in health.

2.An HSB-backed warranty is offered by Augury. In this way, HSB’s Contractual Liability Insurance Policy (CLIP) protects Augury from liability, and the warranty protects the customer.

Augury has partnerships with a number of leading HVAC OEMs, mechanical and facilities management service providers such as Grundfos, Carrier, Sodexo and Trane and is targeting utility room machines, such as air handlers, fans, pumps and compressors with this offering.

Finally, Shepherd (Founded in the UK in 2015) has developed its partnerships with property managers and insurers by providing risk scores which improve insurers’ propositions by enabling preventative maintenance and reducing the scale and frequency of both attritional and major losses.

Through real-time remote monitoring Shepherd helps organisations review their commercial property energy consumption and reduce their carbon footprint and operating costs by 25%. Their real-time monitoring and alerts also transform how risk is managed, preventing issues before they arise, reducing losses and breakdowns.

The startup emerged from Founders Factory, a UK accelerator in which Aviva, the insurer has a substantial investment. Shepherd work with the six largest insurers in the UK to help manage risk and have a presence in several sectors including social housing, environmental services, hospitality and education.

Predictive analytics can spot components failing before physical damage and business interruptions occur. It is a win-win for both building owners and operators and their insurers.