WTW and Thatcham Research have partnered to combine their data and analytical capabilities to better understand the impact of increasingly advanced vehicle technologies on claims risk.
Due to huge transformations in vehicle technology, even mass-market family hatchbacks feature technologies such as advanced driver assistance systems, expensive headlights, and keyless and connectivity systems, WTW said. Sales of plug-in hybrid electric vehicles have also risen substantially. According to WTW, these changes add a new level of complexity for insurers, creating pressure to have a more sophisticated picture of claims data relating to the many varying features of new vehicle models.
Multiple aspects of the insurance industry – claims leaders, underwriters, pricing teams, reserving actuaries and senior management – need to understand how these novel risk factors influence claims trends. These include factors such as which vehicle features represent higher claims risk and inflationary costs, and which ones result in actual savings from reduced injury frequency or severity.
Thatcham Research was established in 1969 by the motor insurance industry, with the goal of containing or reducing the cost of motor insurance claims while maintaining safety standards. Thatcham has been providing vehicle risk data on behalf of its members and the Association of British Insurers for two decades.
The Variant Code dataset from Thatcham Research, which includes over 50,000 vehicle variants in the UK, provides granular data on the growing variety of standard and optional features in vehicles. WTW’s Claim Metrics platform can provide deep analysis of claims activity in the personal lines insurance market, benchmarking over £17 billion of motor claims spend and more than 40% of the UK motor market. According to the firms, the tie-up will see Variant Code’s vehicle specificity combine with Claim Metrics’ data and analytics to give insurers deeper and richer insights of emerging trends in claims risks.
“We are excited to announce this new partnership, which delivers a powerful combination of two unique datasets, supported by market-leading analytics, that offers insurers exceptional levels of insight into emerging claims trends driven by changes in vehicle technology and, as a consequence, the opportunity to benchmark claims performance at a more precise and granular level,” said Tom Helm, head of claims consulting, WTW.
“Empowered by new levels of insight, claims, underwriting and pricing teams are able to make more informed decisions, and price according to the specific features of a particular model variant,” said
Daniel Payne, chief digital officer of Thatcham Research. “This capability is fundamental to maintaining competitive advantage, as vehicles evolve and technologies that were once the preserve of high-end models increasingly become available at entry level.”
