As the last part of this sequence of articles where we explore in depth the past and present of telematics, we now want to show you the predictions and what will come in the future for this type of technology. Pay close attention!
The Future (2022-2030)
Tom Wilson, CEO of Allstate, stated at a recent Bank of America Securities virtual conference that «if you don’t go telematics, you’re not going to be in business for very long, at least profitably».
Within the next 10 years, the norm for the U.S. personal vehicle market is expected to be as follows:
1.Customers will download an app from their insurer on their phone to be insured. It will continuously use the smartphone’s sensors to provide a superior customer experience:
Pay-as-you-go, telematics-based renewal pricing, or a traditionally rated policy based solely on traditional variables such as age, credit score, etc.
The telematics application will have more than 40% of daily active users, as already demonstrated by some international insurers. These interaction frequencies are not far from social networks.
2.Telematics will prevent risks proactively, through real-time warnings in risky situations, as well as through driver enhancement with rewards for safe driving.
Some international insurers have already implemented it and have managed to reduce their expected losses.
3.Claims touch points will be improved through the use of telematics data and collaboration between humans and AI:
Policyholders will enjoy more efficient processes, from proactive FNOL when accidents are detected, to claims triage, adjudication, and repair and payment.
4.Customers will use their insurers’ applications to select from customized telematics-based service offerings and additional risk transfer solutions.
In conclusion…
Forward-thinking insurers are already preparing to welcome telematics, which will require process transformation.
It may not be enough to have a UBI product: the technology itself has a cost, which is why insurers will need to use telematics data effectively to generate a return on this investment.
Finally, insurers will need to educate both externally and internally. Not only will it be enough to communicate the benefits of telematics to potential clients, but they will need every internal functional area to have a basic understanding of it.