Driving pattern determines premium
Monday, 10 08 2018, Category: Technology, Country: World
The days are gone when insurers communicated with customers only when claims were filed. InsurTechs have altered the traditional low-interaction model between insurer and customer by leveraging connected devices and Internet of Things (IoT) to drive product innovation and reinvent customer engagement.
By gathering real-time data from wearables and other connected devices, InsurTechs are popularizing product personalization, and premiums based on highly granular risk assessments.
For example, Root Insurance, an Ohio-based car insurance startup, uses telematics (IoT devices installed in cars to record driving habits) to calculate insurance premiums based on individual driver behavior. Launched in 2016, the product is expected to be available across the United States by 2019. That’s an entirely new business model nationwide in just three years. Not only has Root disrupted traditional premium calculation, it has also changed the business model by acting as an insurance broker itself instead of selling its data to other companies.