Digitalizing auto insurance provides a lot of benefits for consumers and insurers. Auto insurers all over the world have been actively trying to optimize policy underwriting and claims processes, to create new propositions that are flexible, convenient, and offer all-around protection to drivers. While typical policies have been competent in providing coverage to several high-risk groups, these don’t always bring out the maximum efficiency for most average users, indicating the need for a comprehensive data strategy.
Access to non-standardized data in complex formats further prevents insurance companies from offering rich user experiences, leading to ineffective attraction of new customers and lowered profitability. Usage-based insurance model eliminates such gaps from the insurance landscape, provides a streamlined data flow that supports growth, and offers policyholders potential discounts of up to 30% as the cherry on the cake.
Decoding the Strong Demand for Digital Auto Insurance
With the advent of the COVID pandemic, the global auto industry witnessed, for the first time, the flaw in a flat rate of premium for all customers. The disrupted supply chain impacted not just vehicle sales and miles driven, but also global driving trends, resulting in an altered insurance outlook.
Now with their cars parked for the most part, or operating in limited capacities, owners no longer deemed it fair to pay high insurance premiums. Instead, they showed interest in personalized insurance products, customized to their dynamic needs, with a strong inclination of over 56% towards telematics-driven usage-based auto insurance.
Monetizing the UBI Model using Connected Car Data
Acting on the opportunity in hand, companies, and vendors are working tirelessly to get their hands on superior data that can support more meticulous decisions for the insurers, to create affordable and highly personalized products for the policyholders. This is where mobility data comes into play, allowing auto insurers to monitor and measure different aspects of the vehicle as well as driver behavior, to accurately underwrite insurance policies that offer comprehensive coverage along with optimized claim processes.
Tapping into data from connected cars outlines detailed behavioral information regarding the driver and his/her performance, which holds the key to enabling personalized services with in-depth data and rich insights.
Monitoring Driver Behavior & Value-Added Solutions
By utilizing the power of connected car data, both historical and in real-time, insurers get the unique opportunity to design flexible insurance policies that make availing coverage convenient. These include behavior-responsive pricing options, customized to the policyholder, that encourage safe driving by rewarding lower-risk drivers with cheaper premiums, discounts and benefits, and vice-versa.
The data fueling such UBI models is sourced from the vehicle’s telematics system, measuring the driving pattern, usage, and driver’s propensity to speed, swerve, or brake harshly. For an insurance provider, this data gives a much-needed outlook on the driver’s risk profile, which can be further used to proffer coaching opportunities and constructive feedback.
An Experience that’s Easy & Rewarding: Digital Insurance
While it’s true that mobility intelligence unlocks a whole new world of benefits for both insurers and policyholders, it also supports the creation of a more consistent user experience than ever before. Vehicle data augments information from several resources and pulls them together to assess risk on the road, in the most efficient way. Close to 21% policyholders have experienced the benefits of switching from to a telematics-based insurance product. And with this number increasing every passing day, the shared mobility intelligence boil down to one thing – better data prospects that enhance safety on the road.
Boost Customer Retention using New-Age Insurance Solutions Powered by CerebrumX
We at CerebrumX understand the value of vehicle data, that’s at the core of next-generation technologies aimed at improving user experience. Our advanced solutions power an exciting array of innovative usage-based insurance plans that are affordable, practical, and super convenient. With our proprietary AI-powered Augmented Deep Learning Platform (ADLP), you can unlock the true value of connected vehicle data to gain predictive insights that’ll enable you to expand your product portfolio.
CerebrumX believes in total consumer privacy and transparency when it comes to dealing with sensitive PII data. To ensure complete trust and uninterrupted business operations, we enable you to give the power back to the customers by letting them the grant, revoke or edit consents at any time, with our white-label platform, CerebrumX Secure Consent.