Auto Insurance Telematics: The Fleet Owners’ Perspective

Of all the recent innovations in auto insurance, nothing has disrupted the industry like telematics. Usage-based insurance has revolutionized the way insurance is delivered. For the insurer, it offers fraud detection, greater precision in risk assessment, and the ability to reduce claims volume by incentivizing safety. For the driver, it offers fairer, less expensive premiums and a highly-personalized customer experience.

Which explains its rapid adoption. According to a report by IHS Markit, usage-based insurance is expected to grow to 142 million global consumer subscribers by 2023, from 12 million in 2015.

For fleet owners in particular – whether they’re managing HGV or passenger vehicles – UBI is a game-changer. Insurers attempting to win these customers must be prepared to offer the benefits they’re seeking. Here’s the information to bear in mind as you do so.

What auto insurance telematics means to fleet owners

“UBI is a growing interest for connected car and telematics markets,” said Thomas Becher at the UK news source FleetPoint, because it offers companies operating in those spaces significant control over their costs.

With the enhanced driving data that UBI offers – speed, hard braking, mileage driven, garaging address and more – insurers are in a position to offer less expensive, tailored policies to their customers, instead of basing premiums on the average historic driving behavior associated with the profile to which they belong.

For fleet owners, this data makes it possible to visualize the risk profile of individual drivers throughout the fleet. Managers can implement UBI driver coaching and scoring to address individual weaknesses and help their drivers improve – making the entire fleet stronger, safer and less likely to incur claims.

UBI data also speeds the claims process and facilitates faster emergency response when accidents do happen, supporting the health and safety of the fleet’s drivers while making the claims process more efficient.

“UBI has the ability to revolutionise the insurance market, but we are still in the early phases of this technology,” said Becher. “Once the model is clearer and insurers are geared up to handle the data … new business models will be born.”

That last point – being able to handle the vast quantity of enhanced data that UBI collects – is pivotal. Customers who recognize the game-changing opportunity that UBI offers will not choose an insurer that’s unequipped to transform those data into the benefits they seek.

Is your software nimble enough to deliver? Talk to us about our flexible, scalable insurance software that easily accommodates new products such as an auto insurance telematics solution for your fleet manager audience. Or, download our “Losing Your Legacy” report to learn more.