Amazon Key: The Smart Delivery Solution That No One Wants


How It Works, How It Could Impact Your Homeowners Insurance Rates, and Why 80% of People Would Never Try It

It’s probably happened to you or someone you know. You’ve ordered a package, and it will be delivered by the end of the day. But when you arrive at your front step — gasp! The package isn’t there. Package theft claims another victim! While it’s not the absolute worst thing that can happen, it is annoying, inconvenient, and can cause real harm to your wallet.

In October, Amazon announced a solution to package theft: Amazon Key, an in-home package delivery service exclusively available to Amazon Prime members. This should be great news for serial online shoppers like me, but the announcement was met with mixed reviews (more on that below).

How Amazon Key Works (In 4 Easy Steps)

Step 1: Sign up and pay.

Amazon Prime members in 37 cities can now sign up for Amazon Key. (You can check your eligibility at www.amazon.com/key.) You’ll need to purchase an Amazon Key In-Home Kit for $250 which includes the Amazon Cloud Cam (Key Edition) indoor security camera and an Amazon Key-compatible smart lock. Eligible Amazon Prime customers who already have the compatible camera and lock can also sign up.

Step 2: Schedule installation.

Installation is free. Just schedule an appointment at checkout, and a professional will come by and take care of the rest.

Step 3: Place your order.

Customers who sign up for the new service will see “FREE In-Home Delivery” as a shipping option for eligible purchases. The day of delivery, the customer will receive a notification that morning with a four-hour delivery window. Just before the delivery driver arrives at your home, they’ll get an “Arriving Now” notification. Customers can watch the delivery in realtime or view the clip after the delivery is complete.

Step 4: The delivery.

The Amazon driver wouldn’t just enter unannounced. They’d knock first. If no response, they’d request entry into the home through the app with their handheld scanner. Amazon verifies that the package order matches the address, turns on the Amazon Cloud Cam, and unlocks the door. The driver should only open the door wide enough to slip the package into the home and close the door, locking it. Then the customer receives another notification confirming the delivery.

Knowing all of the details of how this works, this does seem really cool. How have the masses responded?

Will Customers Use Amazon Key?

We polled users on Twitter to gauge interest in Amazon Key, and the results weren’t pretty (for Amazon).

Out of 2,109 votes, 79 percent (1,666 respondents) said they would not sign up for Amazon Key. Of those who were interested (just 443 respondents), there were some caveats.

I tried to find people we knew who might try the service as a test, but couldn’t find a single person who was on board.

One colleague told me, “If I lived alone, I would use Amazon Key in a heartbeat. It sounds awesome to me. But I have a wife and two young kids, and I’m pretty sure she’d never be ok with it. So, likely not going to try it anytime soon, unfortunately.”

Three Major Amazon Key Concerns

If it’s so safe and convenient, why are people freaking out?

1. Theft

Even if the camera, lock, and app can prevent someone from stealing on the spot, the delivery driver could still take a quick peek inside (or even outside) the home. While it’s probably not smart of them to return later to steal, that wouldn’t stop someone from trying.

2. Pets

The driver opens the door, and out goes Willie Nelson (my cat, not his namesake). Amazon recommends not using Amazon Key if you have pets that could escape or “access the front door on delivery day,” as described in their FAQ.

3. Hacks (and Ultimately, Theft)

Shortly after the Amazon Key announcement, security researchers from Rhino Security Labs found that hackers could access the camera and disable it. A simple program run on a computer within Wi-Fi range could freeze the camera and make it look like the door was closed the whole time. Meanwhile a thief could stealthily enter the home. WIRED contacted Amazon about the research, who responded that they had plans to send an automatic software update to fix this vulnerability.

Will Amazon Key Impact Homeowners Insurance?

Since the announcement, I’ve read several articles claiming that Amazon Key could raise homeowners insurance rates. But will it?

Why Might Someone File a Claim Due to Amazon Key?

There are a few scenarios:

  • Property theft
  • The delivery driver falls and injures themselves on the property. This is where your liability coverage comes in.
  • Your dog bites the delivery driver. Again, this is covered under your liability coverage.

Will Amazon Key Raise My Rates?

Maybe, but not anytime soon. The insurance industry is slow to change. Let’s use distracted driving as an example.

We’re all aware of the dangers of distracted driving. (Texting while driving creates a crash risk of more than 23 times compared to non-distracted driving, and 26% of crashes involve cell phone use.) So, what happens to your car insurance rates when you get a ticket for texting while driving? Our 2016 State of Auto Insurance report found that one cell phone use violation raises rates an average of about $30 annually. Compare that to a single DUI which raises rates more than $1,000. That’s right, a DUI raises rates 3,200% higher than texting while driving does. Perhaps the insurance industry is not quick to adjust rates for tech innovation after all.

So, unless there is a strong correlation that Amazon Key results in an outrageous number of insurance claims, installing one in your home shouldn’t cause your insurance rates to spike — at least not in the near future. We’ll just have to wait and see how the industry responds to this one.

Is Amazon Key the Future of Package Delivery?

As of now, there’s no data on the adoption rate of Amazon Key, but if the poll is any indication, the future of Amazon Key seems pretty bleak. Don’t tell that to Walmart though. They’ve rolled out something similar.

Would I try it myself? I haven’t had an issue with package theft, so I don’t see a need for it at this time. But if it was an issue, I might try it. With that $250 price tag though? No way.