The following is an opinion article written by Mike Brockman, founder and CEO of ThingCo looking at the rapid evolution of telematics tech, and the significant opportunities it represents for the motor insurance market. The views expressed within the article are not necessarily reflective of those of Insurance Business.
Designing a new car is a complex business. From initial design to the first gleaming vehicle rolling off the production line, the whole process takes a long time. Up to four years, to be precise – practically a century when you consider the speed of light at which connected car technologies, including advanced driver assistance systems, are evolving.
This means that in the time it takes to get a new model on the road, the technology it was built around has already been superseded.
Let’s not also forget that the average age of cars on the road today is around eight years and therefore have none of the tech becoming standard in new vehicles.
It makes sense then that serious research and investment is being made in retro-fitted technology exploiting so much of what we have learnt in making telematics work in the motor insurance market.
The aim is to improve driver safety, reduce claims costs and give motor manufacturers a greater understanding of self-drive technology, opening the way for fully automated vehicles in years to come.
Next step for telematics
Currently, telematics insurance relies on driver behaviour data collected direct from the vehicle, via installed black boxes, on-board diagnostics and even smartphone apps. Cost of installation, maintenance and data collection varies between devices, as does data accuracy and reliability.
Dash-cams are already growing in popularity but only recently has there been any progress in enabling insurers to have access to this data to support claims. So, if you have a dash-cam don’t always expect this to be reflected in your insurance policy.
ADAS (Advanced Driver Assistance Systems) is proven to reduce accidents but as the technology tends to be in high end, newer vehicles – claims costs are higher for repair so, again, insurers have been reluctant to reward drivers with this tech through premium discounts.
So, why not bring all this technology into one retro-fitted device? Wi-Fi, vehicle tracking, driver behaviour monitoring, risk mapping, a high-definition camera, ADAS capabilities with sensors looking forward to the road, and intelligent voice. One device with all of this tech mounted on the dashboard of any car – not just the latest models. This has the potential to revolutionise the FNOL process and completely change the game for telematics insurance.
Current telematics devices report data straight to the insurer, but the new solutions using artificial intelligence would provide immediate feedback to the customer to help avert accidents before they happen. Unlike the same tech being installed in semi-autonomous cars, the retro-fitted solution will report the data direct to the driver rather than to the vehicle computer. Intelligent Voice can also be used to support the ADAS, reinforce good behaviour and warn drivers in hazardous situations.
Benefits across the board
Next generation telematics devices will provide video evidence of incidents leading to claims. It will therefore play a key role in helping the insurance industry tackle fraud, as well as improving the claims journey for both insurer and policyholder. The use of Intelligent Voice will also revolutionise the FNOL process, providing real customer support in their hour of need.
Plus of course, driver scoring will be enhanced through more accurate driver behaviour monitoring. This will enable drivers to reduce their own risk, improving safety on our roads.
The cost of technology is falling, and its capabilities are growing. Coupled with the potential savings the latest devices can provide to insurance providers, ADAS-based telematics devices clearly are the future for the telematics motor insurance market. With the ability to improve the claims journey, provide fairer premiums, create safer drivers and ultimately save lives on the roads, it’s a future that will soon be a reality. Consumers will see this as real added value and for once may see the purchase of insurance as a value for money proposition.
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