Telematics is a paradigm shift for insurers and consumers alike insurance. We’ve also seen a surprising rise in the use of telema cs for livery insurance (think Uber and Ly ) as these policies are a rela vely new market for insurers. In states with strict ra ng requirements, like California, which only allow miles driven as a telema cs ra ng factor, we see the majority of growth in pay-as-you-drive programs whereas in other markets most of our insurance partners offer pay-how-you-drive programs. With our deep understanding of driver behavior, PHYD programs add far more value – and a far greater improvement in combined ra o – for personal, and increasingly, commercial lines.
Nino Taran no CEO Octo Telema cs North AmericaOcto Telema cs, North America Nino is a leading player in advanced telema cs systems and services to the automo ve and insurance industries. He is also Board Director of the Connected Vehicle Trade Associa on (CVTA).
Maneesh Prasad, Editor, Smart Automo ve & CEO of Telema cs Wire explored the horizon of insurance telema cs in discussion with Nino, where he gave an interes ng insight of what lies ahead.
Q
Congratula ons on reaching 5 million connected cars under your Octo umbrella. What numbers do you expect in the next 3 to 4 years?
Thank you. We are excited not only about our growth of connected cars, but our con nued global expansion of clients and partners. Over the next 3 to 4 years Octo will con nue to dominate the insurance telema cs market, expanding our products beyond automo ve, to serve insurers and their policyholders in other areas, such as home, health, and mobility. Adop on will align with awareness, so we’ll con nue to educate the market on the benefits of telema cs and its applica on well beyond simply usage-based insurance (UBI).
A
Amongst various products in insurance telema cs (like PPU, PHYD and others), which one has contributed most in growth of numbers for Octo and why? NINO?
Q A
PG.8
Octo’s solu ons support all the various types of telema cs-driven insurance, so we’ve seen growth in pay-as-you-drive, pay-per-use, and pay-how-you-drive | Smart Automo ve | Jul - Aug 2017
While not an insurance product per say, a substan ve amount of Octo’s growth comes with the introduc on of Octo’s crash and claims capabili es to the North America market. According to the Insurance Informa on Ins tute, US auto insurance total loss costs have skyrocketed by 10x the rate of infla on. The benefits of telema cs for insurers are fully realized when applied to not only risk and pricing but also crash and claims management. Can you suggest the factors which will hasten the growth of insurance telema cs in general in its exis ng Q market? Towers-Watson indicates that usagebased insurance policies only account for around 8% of all auto insurance A policies in the United States today. This likely stems from an overall lack of consumer awareness of telema cs (one study sugges ng only 25% of consumers being familiar with usage-based insurance) and carriers’ strategic emphasis on retaining their best customers at stable rates. This focus leads to many policyholders never hearing about their insurer’s telema cs program out of insurers’ worry that it will cannibalize their own book of business. This is in sharp contrast to the approximately 60% of consumers who would opt-into a usage-based insurance www.telema cswire.net I www.coe-iot.com
