Telematics technology can provide a lot of value to Insurers today and even more in the future. State of the industry today though is that, more often than not, we see our customers struggling with the technology options.
Aftermarket telematics devices are a preferred option when it comes to meeting the actuarial expectations on data reliability, and there are big expectations for the future on using the in-car telematics technology. Nonetheless, smartphone-based solutions continually gain on adoption and popularity for a number of reasons, just some of them being good economics, independence on the car manufacturers, and the mere fact that you need a smartphone in any of the above scenarios to ensure communication back to the customer.
Seeing through the prism of data collection capabilities, Smartphone is just one of the possible tools for usage and behaviour data collection. However, thinking in terms of customer relationship, customer communication, customer engagement, and other customer interfacing processes, smartphone is the one tool to be used to achieve business goals.
Getting to ROI with Usage-Based Insurance is a topic that deserves an article for itself. However, basics should be covered in this context, thus the explanation below:
Yes – we help our customers, Insurance Companies, to achieve lower claims through self-selection and behavior change. Amodo customers have reported up to 15% lower claims for their user base using the Amodo platform). However, it takes volumes and time to get the return on investment only by harvesting that one particular business aspect.
There are other business aspects that should not be overlooked and must be factored in the business plan too, such as:
- capability to create new products and thereby differentiate, address new market segments and consequently drive more Revenues,
- engage with the customer in order to collect more data, learn about their personal needs and habits, and consequently create higher loyalty by addressing them individually through personalised products and services (Amodo customers have reported up to 10% higher loyalty for the user base using Amodo platform),
- address the engaged customer base through the smartphone channel to drive up-sell and cross-sell of Insurance Products and Services and consequently drive more Revenues (Amodo customers leveraging on this approach achieve ROI within 8 months on average).
Especially when it comes to the subject of driving more Revenues through up-sell and cross-sell, smartphone data becomes essential. Through the data provided by Smartphone, Insurance companies can learn about their users’ journey even after users leave their car on a parking lot. And this is why Smartphone, even as a data collection tool only, has more value than Telematics Box ever will. Telematics Box connects you with the car, Smartphone connects you with the customer.
Amodo platform enables insurers to develop a new category of products based on behaviour and usage data. The Platform collects data from smartphones and other connected devices in order to build holistic customer profiles, providing better insights into customer risk and customer products needs. Amodo technology and methodology is approved by insurers around the world.