Is RFID Reducing Your Insurance Bill?

If so, another reader wants to incorporate this information into his business case.
Published: November 15, 2007

I received an e-mail the other day from a reader planning a large RFID installation. He’s in the process of putting together the business case, and wants to include all the potential benefits likely to accrue from the deployment. One possibility he hopes to examine is whether the RFID deployment might result in reduced insurance premiums, because the system provides more accurate and timely information.

There are companies using RFID sensors in ways that could reduce risks. For instance, one firm I know of (which will remain nameless) has a good deal of hazardous materials in a warehouse, and has used active RFID technology to alert security whenever a container is moved without authorization (an accelerometer sends information to the RFID transponder, which communicates the information to a reader, which passes it on to a software system that sends the alert). And Frankfurt Airport has been using a system to ensure that fire protection equipment is inspected on a regular basis.

If a company knows that an employee or trespasser cannot remove hazardous materials from a site, it would seem that company is at less of a risk than a similar company not using RFID. Similarly, if Frankfurt Airport knows that all its fire prevention equipment is being properly maintained, it poses less of an insurance risk than an airport not using RFID in this way.

But I don’t know whether these two organizations are actually benefiting from lower premiums. And our reader can’t build this into his business case unless he can show that other companies deploying RFID have achieved lower premiums. So if you have benefited in this way, please send a confidential e-mail to I would like to put you in touch with our reader so he can incorporate insurance savings into his business case.