“It’s all very well to get all this data on driving behaviour but you’ve got to do something with it,” said Sydney-based Simon Donovan (pictured above), executive general manager of commercial for Fuse Fleet Underwriting.
Donovan’s insurance offering, called Fuse Fleet, launched in April. The offering is a behaviour-based insurance for the motor fleet market that uses telematics.
“In terms of pure underwriting and risk services, there isn’t an insurer or agency out there who’s taking the raw data – like we are - and ingesting it into a system that creates a pricing methodology,” he said.
The insurance offering includes interpreting data from a fleet’s drivers to inform strategies to improve safety and efficiency and, hopefully, lower the cost of premiums.
“We come along and offer to take this data and help the company positively change the behaviour of its drivers,” said Donovan, whose firm is part of DKG Insurance Brokers. “It’s a no brainer, there’s no cost for the company - but I’m interested to see how we can articulate this in a way that people understand.”
Telematics, he said, has been on the motor industry scene in Australia and New Zealand for about 30 years.
“There’s about 20% telematics penetration in the fleet space and there’s a big focus on heavy vehicles because of the regulatory requirements,” said Donovan. “That evolved from basic GPS, to keeping track of people in vehicles and also using it for things like tracking fuel tax credits.”
In recent years, the technology has been used more for improving safety and optimising drivers.
“For example, if you run a courier business you might want to know how they drive, when they get there and how many stops they do,” said Donovan. “So, it’s all big data.”
Geotab, one company in the telematics space, he said, has more than 3.5 million devices globally. Donovan said their market research shows that, in Australia alone, there’s an addressable market of 2.9 million vehicles.
He expects the “paramount” importance of safety and duty of care to positively dispose motor fleet operators towards adopting telematic offerings like Fuse Fleet’s.
“The [fleet] directors are responsible for the business and if they don’t do something with the data, there is this duty of care issue,” said Donovan.
Donovan said this telematics-based offering is still a novelty in his particular motor industry sector: fleets with more than 20 vehicles.
“We understand there’s an Australian agency who buy, manage, and underwrite vehicles with telematics installed,” he said. “So there’s a small component of telemetry insurance in there but they don’t play in the larger fleet space, more the Uber driver and taxi driver space.”
He said some of the big insurers – like NTI who insure heavy vehicles – are deploying camera-based technology.
“Dash cam versions of these cameras are becoming cheaper and cheaper,” said Donovan. “They provide the possibility of recording an accident to see what the distraction may have been.”
However, Fuse Fleet’s telematics technology, he said, uses what’s called DNA profiling. Donovan said no-one else in Australia is using this approach in the motor fleet space.
“Our partner, Greater Than, use pattern profiling and they look forwards,” he said. “They don’t look at speeding, accelerating, harsh braking, all these basic sort of trigger points that general telematics companies use.”
Instead, Donovan said, this Stockholm-based Swedish firm gathers data based on ‘future thinking’ that aims to prevent accidents from taking place.
“At Greater Than, our pattern AI technology enables us to understand driver impact on the roads in a unique way,” says the firm’s website. “By analysing per-second GPS driving data we can create a DriverDNA for each trip and compare is against our database of over seven billion patterns to rapidly determine crash probability and climate impact.”
Donovan said his firm’s first sale channels include telematics companies that have existing fleets and so already have driver data.
“We have established APIs in the backend with several major players to allow data to seamlessly flow allowing instant risk profiling,” he said.
The next channel will be fleet operators across Australia and then insurance brokers who he described as “critical to the distribution.”
Donovan’s parent firm, DKG, is an insurance brokerage. He said that more than 60% of business is placed via brokers.
“We will also educate brokers because they are going to require education on how telematics works,” he said. “It will be an alternative offering for a broker who wants to be more focused on safety and reducing accidents rates.”
Are you a broker in the motor fleet space? What’s your take on telematics?
