At a recent Auto Insurance Report National Conference [AIR] the theme was that advances in data collection will provide benefits to consumers and challenges for insurers. Sources of data will vary from government agencies to data collected from cars via telematics. Auto Insurance companies will have to figure out how to stay on top of up-and-coming demographic trends, including the increasing influence women have in the purchasing decision. They can increase their knowledge of customer needs and serve their clients better.
Auto Insurance Facts revealed at the conference
1. Auto Insurance Market. There wasn’t much movement in the auto insurance market in the past few years, but the top 7 insurers increased their market share by aggressive pricing and advertising. That leaves some companies with waning revenues and at risk over the long-term. Only a few other companies showed growth resulting from first-class customer service and retention programs. If insurers make intelligent use of the new data they will improve their understanding of customer needs and discover growth prospects.
2. Telematics. Companies have gone ahead assertively with their telematics schemes. Many major auto insurance companies have introduced programs over the last year. Telematics is an ends to a means. The best move is Usage-Based Insurance (UBI) – where a driver’s behavior is used to price the policy more accurately. Insurers cannot put off development of a UBI solution. Consumer demand will increase hand in hand with the adoption of UBI as well as the corresponding advertising budgets to flaunt these cheaper and smarter policies.
3 Google’s Self-Driving Cars was showcased where a legally blind person is able to commute using this “smart” technology. It is expected that these cars will be publicly available in 5 years. Safety ratings will be higher. Driving and accidents will be video-recorded. This will bring forth complicated implications for auto insurance companies and fresh challenges for underwriting and service.