The future of (motor) insurance is connected (obviously) – thoughts?

I was fortunate enough to present and share a panel (I am the short bald guy in the middle) with the esteemed Kinda Nejem and Trygg-Hansa’s Fredrik Thuring for this wide-ranging session, which prompted several discussion points from the attendant audience.

In broad terms, there were three areas of debate:

1) Consent and incentives to share data?

Clearly, the consumer has a choice of insurance provider.  In our Admiral/Ford/REDTAIL [Insurer/OEM/REDTAIL] model the sell is either insurer or OEM. The ‘opt-in’ and permissions are managed by i) OEM – in-dash display prompted and ii) Insurer Ts & Cs signed.   Our primary research indicates that consumers will respond to ££/€€/$$ based rewards for better/safer/more eco-driving.

Insurance Observatory (IoT Insurance Observatory: Global insurance think-tank (iotinsobs.com)) primary research indicates that the ROI works for the insurer as well.

2) Who is leading this tech and it’s adoption, and doing it well?

mmmmm……a number of noisy players might claim they are, a couple of failed equally noisily. REDTAIL takes a very considered view, in testing and learning and testing again. This takes time and effort and dialogue and patience and understanding. And the willing to commit resource to innovate.

None of which is necessarily the DNA of all large corporates! Just saying! So to answer the question, we are!

3) How will this impact the insurance company of the future?

Connected vehicle data can be used across risk, propositions and claims – at least! So first answer: it should impact broadly. Secondly, (and I am borrowing a phrase from Fredrik) it will make jobs in all areas including actuarial more interesting. Richer and more immediate data providing increased insight, value and ROI. Insurtechs partnering with insurers offer the thinking and doing to accelerate pilot through to adoption.

Those that don’t will suffer worse loss ratios. No really.

Concluding thoughts?

Not sure. In many ways it is early days; in other ways it is also late – there are other players making noise and moves.

Call to action: do something! Do something with direction, intent, testing and learning – and do it now !

Connected Vehicle data – relevant to insurance?

We at Redtail think YES most definitely! Here’s why…

But first, what is Connected Vehicle?

Most cars produced since 2019 can (with the owner’s consent), produce a stream of data describing where and how the vehicle is being driven. OEMs produce this in their own different formats, but Redtail converts the OEM data into our standard format and thus making it viewable on our portals to help insurers assess risk and manage claims. The data can also help fleet managers understand how they can manage their fleet more efficiently and effectively.

This data stream is, in essence, Connected Vehicle.

As a journey is completed the data is (within a minute in most cases) transformed into our standard format for Journeys for you to use.    This OEM data (Connected Vehicle data) is now identical to data created from our devices (processed consumable journey data).

Connected Vehicle capability can produce additional event data that may be relevant to understanding the risk of a driver making a claim.  For example, we know if the passenger seat is occupied or not.  This may mean a claim for injury may be increased or prevent fraud.    We are also told if driver aids such as traction control are enabled.  These may mean the likelihood of an accident (or the severity of damage) is reduced.

Data analysis is easy with our systems!

As seamless as using one of our devices, data access is simple.  We can push out a notification as soon as a journey is ready. When a notification is received, a customer can call our API to download a JSON document containing detailed 1Hz data describing the journey.   This document is in the same format as documents created by our devices.  So, whether you’re consumer data using one our of devices or via Connected Vehicle data connection, data analysis is easy with our systems.

Many of our customers have large investments in existing systems.  We are happy to work with you to create bespoke feeds to integrate with your new or existing systems and data, even including translating between different measurement methods such as time and distance.  Sound great in theory but worried how difficult this would be in practice?  No need to worry, we have proven cases of how easily our developers can get you set up, regardless of whether from hardware device data or Connected Vehicle data.

Data is available to you via REDTAIL’s flexible and open APIs

REDTAIL is trying to help you, the motor insurer, to realise long promised scale with actionable, valuable telematics data relevant for ever-broader segments within your book.  Our Connected Vehicle data is immediate, rich, and validated through our typically robust Proof of Concept testing.  It is available to you via our flexible and open APIs.  Plus, Redtail offers accessible and manageable web portals and mobile apps that can be tailored to your specific requirements.  And lastly there are rich and powerful additional datasets available set to enhance proposition and claims evolution going forward.

We are excited to start your journey of Connected Vehicle and its place in the world of IoT technology.

The Redtail Bluetooth keyfob – how does it fit in with IoT?

First, we need to ask, IoT = Internet of Things – what does that mean?

‘Internet of Things – connection through the internet of everyday devices to send and receive data.’
[Oxford English Dictionary]

REDTAIL was founded on expertise in Stolen Vehicle Tracking and Usage-Based Insurance

Both of which applications connect REDTAIL devices (in cars) through wireless connectivity to send and receive [valuable] data.

Over the last 6-12 months we have added to our capabilities in a diverse and interesting way

In all three examples below, we continue to explore the potential of data derived from the Connected Vehicle.

Activity includes:

• The identification and measurement of potholes, in order to manage the efficient deployment of maintenance teams to repair potentially damaging road surfaces
• Phone network quality – collect specific information about the cellular network, such as signal strength, network ID and cell tower ID
• Usage-Based Insurance – collection and management of connected vehicle data for provision to insurers in a format that they recognise and value

The challenges in understanding new use cases are interesting, but solving them is very much in our DNA

Necessary device (if appropriate) and firmware settings, APIs and data interpretation and presentation combine to answer key questions:

• How do we derive the right data from the lorry/van/car/device or other!?
• How do we deliver to Data Warehouse in the right frequency and volume in a cost-effective way?
• How do we aggregate, analyse and make available in as useful, convenient and valuable a way possible?
• How do we keep improving in line with customer feedback and expectations

REDTAIL’s design engineering and consultancy background enables genuinely disruptive [IoT] solutions

All of which may sound like typical and standard product management disciplines.  But REDTAIL’s design engineering and consultancy background (through founding/parent company Plextek) warrants a unique way of thinking, planning and problem solving which enables genuinely disruptive [IoT] solutions.

Although we are a business striving for clarity of strategy and execution (focus if you like!) we would not pretend to know where the next opportunity or enquiry might come from.  Which is not to say that our capabilities can do simply anything – relevant and adjacent to largely existing business seems sensible.

So, to answer my original question ‘IoT – are we there yet?’ I don’t think we would ever be arrogant or complacent enough to say yes to that, but we have increasing conviction that our IoT capabilities certainly can do.  The Redtail Bluetooth keyfob is just the tip of the iceberg.

Car insurance – could telematics be the answer to fairer and friendlier options?

It is broadly, if reluctantly, acknowledged that the purchase of car insurance is not the average consumer’s most pleasurable or engaging experience.  A 2020 moneysavingexpert.com survey found that 38% of drivers say it’s too much hassle to change insurance provider.  Feedback cites an absence of transparency, value and fairness.

The pandemic, as we all know, has exacerbated perceptions that insurers are, by and large, blind to sentiment and intent only on profit.  Ah well.

Change needed

Yet, with the welcome of new rules against ‘price-walking’, January this year marked the end of higher prices for existing policyholders compared to their new counterparts.  There would appear to be an opportunity to use more informed data on drivers to best effect.  So we thought we’d ask two thousand UK consumers for their thoughts (for the third year running) on communication from insurers around:

• Benefits of telematics-based insurance
• Potential benefits in fairer pricing
• Improved road safety
• Environmental impacts of driving behaviour

Our results are both interesting and alarming, and undoubtedly herald opportunity.  But let’s start with the headline:

Just 4% of our sample have received any communication from insurers on a telematics-based car insurance policy.

Yes that is correct: of the 2000 drivers surveyed, just 80 people had been approached to adopt a fairer, safer, more environmentally conscious policy.  How so?

Let’s scrutinise a little.

Our survey also revealed an absence of awareness and education on telematics data on car insurance.

Specifically, how it can be of value for you, the consumer, in designing your policy.  That data presents a view on risk – how your driving style and capability and routes impact the likelihood of you making a claim – that is more detailed, nuanced and advanced than the typical postcode/parked on/off-street deliberations.

Secondly, insurers can help you, the driver, evolve your way of driving to be safer and more emissions efficient.  Lastly, in the event of a claim, there is granular data available to manage claims more fluently and fairly for all involved.

By way of a conclusion, and without wishing to be hectoring, let’s imagine how that conversation goes:

Old way

Telematics way

Is it so difficult?  We at REDTAIL know that we can do more to educate on telematics benefits.  We are utterly committed to supporting insurers and brokers with data that informs their data.  Data that can offer compelling reasons for consumers to adopt the best value and fairest policies in pursuit of safer and more environmentally-friendly driving.