Making the Economics of Telematics Work for Insurers

By Casualty Actuarial Society | May 19, 2014
A study by claims telematics data can show where drivers are going, unbeknownst to most users of the technology.

  • May 19, 2014 at 1:07 pm
    TelematicSam says:
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    Remember of course that smartphone telematics completely changes these economics as they have no installation charge, no hardware construction costs, no distribution costs, no networking charges etc. These innovations completely change the barriers to adoption. Smart Phone solutions seem to be growing for example the solutions of AIG in Ireland and DrivePlus App for Direct Line provided by http://www.thefloow.com which have both developed a wide user base without any troubling economics.

    • May 19, 2014 at 3:17 pm
      Libby says:
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      How does the smartphone app work? Does it have to be plugged into the car?

      • May 20, 2014 at 11:59 am
        EmpoftheEarth says:
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        Uh Libby…the app on your smartphone would sync with an external device. The app is not a physical item…it is a program on your phone. I would think that you would plug your phone into a USB port (if your vehicle allowed it).

        • May 20, 2014 at 3:03 pm
          Libby says:
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          Uh, Empo, I know the app is not a physical item. My question was whether the smartphone would have to be plugged into your car dufus.

          • May 20, 2014 at 5:03 pm
            EmpoftheEarth says:
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            I think this second response does not deserve any rebuttal. Bravo Libby!

          • May 22, 2014 at 9:56 am
            Agent says:
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            Empo, have you noticed Libby cannot seem to make a reply without insulting or calling someone a name? That is her nature and she cannot help it.

          • May 22, 2014 at 10:42 am
            Libby says:
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            That’s right, Agent. When I’m insulted, I strike back. Empo’s response to me was condescending and insinuated I was stupid. You do it to me all the time, so I have no problem insulting you. It’s very easy to do. Almost too easy most times.

          • May 23, 2014 at 12:24 pm
            EmpoftheEarth says:
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            I was not being condescending. There are many people who are clueless about technology. But I apologize..you are the resident guru on everything under the sun. Libby, I have been curious…which came first: the chicken or the egg? And please dont respond that Bush prevented both from happening. That will not be an acceptable answer.

          • May 27, 2014 at 9:13 am
            Libby says:
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            The “Uh” at the beginning of the post says otherwise. If you were truly trying to be helpful, you would not have included that little tidbit. But nice try at backpedaling.

      • June 6, 2014 at 11:08 am
        TelematicSam says:
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        This telematics App (and similar others) work as an app on the phone without need to install hardware into or connect to the vehicle at all.

    • May 21, 2014 at 8:13 am
      milner says:
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      Some implementation questions. How does the smartphone know which car it’s in? How does the phone know you’re not on a bicycle? How do you know the phone is not turned off for dangerous driving? How do you track all the ususual drivers of a car? The phone solution is cheaper but leaves us with some questions.

      • May 21, 2014 at 12:41 pm
        Libby says:
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        Exactly! There’s your rebuttal Empo.

        • May 23, 2014 at 12:25 pm
          EmpoftheEarth says:
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          Really Libby? Really?

          • May 23, 2014 at 2:59 pm
            Agent says:
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            So Empo, you are getting the treatment now I see. It has been going on for about 4 years with me.

          • May 27, 2014 at 9:14 am
            Libby says:
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            Really Emp. Really.

      • June 6, 2014 at 11:14 am
        TelematicSam says:
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        Good apps use the signals and data gathered to determine if on a bike, walking, plane, etc and discard the information from usage.

        Users may turn phones on and off, they will also run out of battery but the data gathered can determine typical driving regardless of this giving a picture of driving which is what is needed for usage based insurance.

        Most policies worldwide have designated drivers for a vehicle not ‘unusual drivers’ – unusual drivers are not covered on most insurance and cannot be monitored. In some territories a vehicle is insured seperately and if all drivers do not have an App then this may not be the best approach. In which case an ODB approach or black box is a better solution.

  • May 19, 2014 at 2:19 pm
    Agent says:
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    Can we officially say that Big Brother is watching us?

  • May 20, 2014 at 9:55 am
    EmpoftheEarth says:
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    I had heard of a company called Automatic that manufactured a product that plugged into the ODP port in your vehicle and you downloaded the app that synced with the device and gave you readings on your driving performance and also analyzed those engine warning codes.

  • May 21, 2014 at 11:03 pm
    Ramkumar says:
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    Telematics, predictive analysis and big data are going to shape the future (near) of insurance underwriting. That day is not far when your insurer predicts your driving behavior based on the updates made in Facebook, Twitter and other social networking sites :)

    • May 22, 2014 at 10:43 am
      Libby says:
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      I’m getting off Facebook and don’t use any other social media. Here’s to doing it old school!

      • May 23, 2014 at 11:50 am
        Agent says:
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        Libby, the way you like to drive (speeding), your premiums would skyrocket when the computer analyzed the data even if you didn’t get a ticket.

  • May 22, 2014 at 10:06 am
    james says:
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    Way too much information being collected already. Never gonna plug into my car!



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