Some of the prevalent encounters identified in the telematics space are; the eruption of data, social media, the proliferation of channels and devices and the shifting of consumer demographics. These dynamics are serving as a catalyst for change driving both challenges and opportunities for an organization.
Extraordinarily, the two most influential forces identified is the rapid evolution of technology and markets; these two forces drive increasing levels of complexity with products and services. Engaging with customers is more than just communicating with them; it’s about helping them enjoy the products and services they have acquired and collaborating with them to co-create new products. To understand this means getting closer to them; customer expectations are increasing, they expect improved products and services, more choices and additional value.
Consumer telematics is leading the big data sensation of today, touching various companies from insurance, fleet operators to rental companies who are now starting to use telematics to improve insights of how consumers are using their offerings. It is an exciting market, as auto OEMs are associating new infotainment and safety applications with their brands and experimenting with various subscription models. This ecosystem is delivering solutions for the connected car market.
UBI (user-based insurance) is fast becoming a necessity for insurers as they search for ways to control claim costs, enhance pricing sophistication, improve profitability and differentiate their products and services. With a number of services accelerating the growth of Telematics, UBI will reach a tipping point sooner than many would expect. For many organizations the need to manage high-risk drivers and reduce loss and accident costs are increasingly important; telematics data provides high-risk solutions which can be added to pro-active training and intervention.
Telematics-based insurance products have several core advantages: growth, retention and transformational improvement. However, there are some main challenges facing the industry; no blueprint for telematics integration within the commercial insurance industry and the need to deal with complexity and velocity of big data, as the insurance telematics market evolves. Behavioral metrics should become standardized with data aggregation and ownership models that improve the customer experience, by enabling consumers to share driving data securely without having to switch devices or cancel telematics services.
UBI can provide solutions to overcome many wider government and social issues such as congestion in urban areas, lowering carbon emission goals and increased safety. UBI has the ability to assist with predicting a propensity for loss through real time customer scoring and data mining of customer driving behaviors, including location, time, driving styles and vehicle types. This can also assist consumer satisfaction levels through faster claims handling, roadside assistance and stolen vehicle recovery.