The revolution that the automotive industry is going through is amazing. The technology forces are giving rise to disruptive trends such as electrification, diverse mobility and autonomous driving, changing the way we travel fundamentally. It comes as no surprise, therefore, that Auto insurance itself is going through a transformation and is ripe for disruption.
Auto insurance providers are increasingly using technology to cater to customer expectations - more convenience, more personalized services and more solutions for the changing transportation methods and risk profiles. We, at Texas P&C Insurance Agencies, follow these trends closely so that we can provide you the right product advise when it comes to purchasing Auto insurance. In this article, we are highlighting three of these innovative trends that have already found their way into the insurance market.
1. Shift towards risk prevention by focusing on improving driving behavior
Telematics or Usage based insurance products have been in the market for a while. Instead of determining price by evaluating risks based on past events, these products take a proactive approach and price the risk based on real time information about how and where you drive. This trend is now progressing, and the focus is now moving from cost proposition to improving driving behaviors and prevent accidents. Insurance companies are providing real time feeds to mobile apps and in-car dashboards that details your driving behavior, compares with other similar drivers, provide tips to improve driving performance and even reward you for save driving.
2. Pay-Per-Mile Car Insurance products
If you are a low mileage driver, you will love this trend. Imagine paying for auto insurance only when you're actually driving, not when your vehicle is sitting idle in your driveway or garage. Yes, there are InsurTechs that now offer per-per-mile car insurance products. These companies will give you a base rate and a rate per mile, with each mile usually costing just a few cents. For example, if you drive 300 miles per month at a rate of say 5 cents per mile, you would be charged $15. The base rate, which is consistent every month, is usually $20 onwards, depending on more traditional insurance factors.
3. Artificial Intelligence based Claims processing and settlement
Insurance companies are adopting artificial intelligence to process your claims faster, bringing down the settlement turnaround time from days to minutes. These initiatives aim at automating claims intake and assessment by analyzing scanned documents and images and comparing them with your insurance policy to determine whether a claim should be paid out. The solution will further assess the extent of damage and determine the settlement amount, and if the claim falls under certain criteria, it will actually pay out your claim. Also, there are some insurance companies that are now using sensor technology that will automatically file an insurance claim in case of an accident. Though promising, this trend is yet to pick up.
We, at Texas P&C Insurance, keep a close watch on new auto insurance products and services, and can help you assess them to fit your insurance needs. You can call us on 972.293.2139 or contact us online here.