This article has been revised and corrected from its original version.

One day about three years ago, Torrance resident and property management company employee Neal Miyake and his wife were walking through the downstairs portion of their home when they noticed that a section of the floor seemed a bit “squishy.”

Unbeknownst to the couple, a steady stream of water from a pinhole-sized leak behind one of their walls had been flowing for months and accumulating underneath the floor.

They brought in a plumber to investigate, and it was the plumber who discovered the
exact location of the leak. The total bill to repair the pipe and the flooring came to about $8,000.

Fortunately, the couple’s homeowner’s insurance company covered the repair cost, leaving them only with the policy deductible.

“The worst thing I remember about the whole incident was those huge noisy fans that had to run 24/7 for days to dry the place out,” Miyake said. “Those were awful.”

The episode prompted the couple to investigate if there was something they could do to prevent such a leak from happening again. A friend of theirs had heard about a product from a local company called Phyn that detects water leaks and can automatically shut off the main water valve when a leak is detected.

The Miyakes ultimately decided to buy the product from El Segundo-based Phyn, a subsidiary of consumer electronics company Belkin International, also based in El Segundo. The installation took just over three hours, and the total cost came to nearly $1,000.

Belkin roots

The Miyakes were not alone. In the ensuing months, they heard about several other leaks at homes in their neighborhood.

Household leaks can waste more than 1 trillion gallons annually nationwide, equivalent to the annual household water use of more than 11 million homes, according to the Environmental Protection Agency.

According to figures from Branchville, New Jersey-based property insurance firm Selective Insurance Group Inc., the average cost of a damage claim received by the insurance company from a residential water leak in 2022 was $13,000.

Yet the technology to spot leaks before they turn into major visible problems has generally lagged behind this demand.

It was against this backdrop that a team at Belkin formed in 2009 to look into this market, according to Ryan Kim, Phyn’s chief executive. Kim was part of that team.

The Belkin team came across a company called Zensi that had been developing microscopic pressure sensing technology that could detect where leaks might be occurring through variations in water flow. Belkin acquired Zensi and its technology in 2010 and then spent the next five years honing the technology through the integration of artificial intelligence algorithms that could determine what uses could be generating the leaks.

Kim said a key obstacle was reducing the occurrence of false alerts. For example, in a household where everybody usually showers in the morning, someone taking a shower at night would create a water use surge that could trigger leak detection alerts.

“You have to sort out unexpected bursts in water use from actual leaks,” Kim said. “This involves extensive training of an AI system, getting the system to recognize the unique pressure vibrations of turning on a shower versus a burst pipe.”

Phyn spinoff from firm

In 2016 Belkin formed a joint venture with Helsinki, Finland-based plumbing, heating and infrastructure company Uponor; the joint venture was spun off and given the name of Phyn.

Two years later, the first Phyn leak detection device came on the market, with an auto-shutoff feature that is installed next to the main water intake pipe for the residence. That way, if a significant leak is discovered, the water for the entire residence can be shut off, thus preventing further damage. The homeowner does have the option of overriding the shutoff feature.

Phyn’s technology can only determine that a leak is occurring and and indicate which general water-related device it’s likely coming from, such as a dishwasher, washing machine or shower. Once a leak is identified, the Phyn device cannot repair it – only a plumber can.

Kim said the company has initially focused on the residential market – both single-family and multifamily – chiefly because of the standard-sized pipes used to convey the water. Commercial and industrial buildings, which often have to move large amounts of water around, use a mixture of small and large pipes, which complicates the technology’s deployment.

Eventually, Kim said, the artificial intelligence algorithms will be advanced enough that different sized pipes can be targeted, thereby opening up the commercial and industrial market.

Partnerships with parts makers

Phyn is one of only a handful of companies across the nation with leak detection sensor technology and related auto-shutoff capability, according to Sara Gutterman, chief executive and co-founder of Green Builder Media, which covers sustainability issues.

“We’re seeing some big plumbing manufacturing companies acquiring these leak detection technologies,” Gutterman said.

One other player in this arena is North Olmsted, Ohio-based plumbing parts maker Moen Inc., which markets a leak detection and auto shutoff device under the brand name Flo.

According to Michael Brown, executive editor of TechHive, a website focused on smart-home market from a DIY perspective, both Phyn’s product line and Moen’s Flo product line have fared well in his tests.

“Each time one of these two companies comes up with a new innovation in their technology, it becomes the better of the two – until the other company comes out with its own innovation,” Brown said.

To compete in this market, Phyn has formed its own partnership with a plumbing parts maker: Kohler Co., headquartered in its namesake city in Wisconsin. Kohler’s H2Wise leak detection product line incorporates Phyn’s technology.

Phyn also has a partnership with Woodbury, Minnesota-based EcoWater Systems, a Marmon Group/Berkshire Hathaway company. Under this partnership, the Phyn product line is offered as part of a product suite for EcoWater’s water treatment systems that are sold through dealerships.

Partnerships with insurers

But Phyn has also focused on another set of partnerships – with insurers, which stand to reap significant savings from water damage avoided by Phyn’s devices.

This year alone Phyn has reached partnership agreements with two insurers: Selective Insurance and Lincoln, Rhode Island-based Amica Insurance.

Under the deal with Amica, policyholders receive a 15% discount off the price of Phyn products. The Phyn Plus leak detection and water shutoff device retails for about $580. The announcement with Selective Insurance indicated that for certain policyholders, the insurer would offer the Phyn devices, though further details on the extent of the discounts were not disclosed.

Besides the obvious financial incentives, the partnerships with insurers also address another of Phyn’s key challenges: boosting awareness of the need for leak detection devices. A related challenge, Kim said, is the need for plumbers to install the Phyn Plus device that includes the auto-shutoff feature.

“For the most part, homeowners only call a plumber in when there’s an emergency,” he said. “This is preventative maintenance and people are reluctant to call plumbers for that type of service.”

Homeowner Miyake said he wished he had known about Phyn before the water leak in his home. Since the Phyn device was installed, it has notified the Miyakes of two incidents: a leak inside a washing machine and when one of them failed to turn off an outdoor water sprayer. For the washing machine leak, the Miyakes called out a repair person, who replaced the part responsible for the leak.

“In the two years since I bought it, the Phyn device hasn’t alerted me to anything really major, which I guess is a good thing,” Miyake said. “But just having the Phyn technology is great.”