Parents will pay more for peace of mind when it comes to teenage sons and daughters getting behind the wheel, says one U.K. company looking to break into the Canadian market – bringing not only his telematics technology, but promises of client growth for the country’s independents.
“On average we’ve brought premiums down in the last 12 months in the U.K. by between 30 and 40 per cent,” says Richard King, founder and CEO of ingenie, “whilst at the same time achieving a loss ratio of about 70 per cent. If you look at the U.K. book for young drivers, it is well north of 100 per cent. We look to replicate that in Canada.”
It is that potential for savings that is attractive to auto insurers – and proven increased safety that parents want for their children, says King.
“That is what is on parents’ minds. You’ll find that parents might actually pay $50 more for your product if they think their sons and daughters are a lot safer on the road,” he says. “Of course, what parents are looking for is cheaper insurance – but they are also looking for peace of mind as their kids take to the road for the first time.”
King, who brought his message of telematics for teenage drivers to the Insurance Brokers Association of Ontario’s Convention in Toronto, sees the Canadian insurance perspective on young drivers as something akin to a five-year-olds palate and broccoli. (continued.)
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“What I’ve learned so far, coming to Toronto, insurance for young drivers is viewed almost as insurance under suffrance,” he says. “You almost do it because you have to, not because you want to. So we’ll be the first brand to come out saying we’re auto-only, and it is purely about young drivers. And that is saying, ‘We want you!’”
It is that attitude that can be a game changer for insurers, says King – especially those independents looking to grow their business.
“There is an opportunity for us to talk to them about other issues, about distracted driving, about peer pressure,” says King. “That’s why the initial sales marketing, a lot of it is through social media. If done in the right way, it can be a conversation; it is not about a hard sell. So quite often our conversations are about road safety – they’re not about reducing insurance.”
By attracting that teenage client through social media, the hearts and minds of the parents can be won, says King.
“We are going to be working closely with the IBAO. We want their broker partners to be selling the product,” says King. “We will market the product, create a lot of awareness, but we will also be offering families with existing policies to expand with the product. If they deliver on the promise of cheaper and safer driving, then that broker has a greater opportunity to sell other products.”
King says the ingenie product will be ready for use in 2014. (continued.)
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“We are ready to go Q1,” says King. “We have to go through a process with the regulator, but we’re hoping that is going to go as quick as possible.”
The IBAO has been working closely with the regulator, and have already been speaking to them, says King. “We are hoping to have some positive conversations,” he added.
“We are pleased to welcome ingenie to Canada and are excited about the potential of partnering with them,” says Randy Carroll, CEO of the IBAO. “Given the current challenges the industry is facing as it relates to the cost of insurance we are confident that our partnership will go a long way towards lowering rates for consumers. Road safety and education for young drivers is one of the key objectives of our members.”
Ontario’s Quindell Portfolio increased its investment in ingenie Limited to 43 per cent in September, extending ingenie’s telematics insurance offering to those 25 and over across the Britain. ingenie Canada will offer telematics insurance to drivers of all ages across Canada.
Prospective partnership discussions have already commenced with major brands in the U.K. who in combination represent over 25 per cent of U.K. drivers and a number of core industry participants in the Canadian markets, including the Insurance Brokers Association of Ontario, whose members directly or indirectly distribute approximately 60 per cent of insurance in Ontario.
