As a telematics service provider, built on a strong foundation across all the components of usage-based motor insurance (UBI), LexisNexis Risk Solutions company Wunelli has started looking ahead to some new steps in the insurance value chain.
In the insurance industry, we do everything we can to prevent collisions, through education, driver coaching and communication, and by linking behaviour with an incentive to change (with premium pricing).
But when collisions occur, we want to provide new opportunities for proactive customer care, new opportunities for process improvement and better data for better decisions (using evidence-based data to resolve legal disputes and eliminate fraud).
It is established that UBI data will become the enabler of the connected car insurance of the future. The telematics raw data meanwhile continues to become more verified, cross-tested, greater in volume and cheaper to deliver to more drivers, with new hardware on the way such as our plug-in 12V dongle device.
One important question for the future business benefits of UBI is how to create actual new insurance services looking ahead? How to evolve the business case so as to drive out even more costs and create new benefits? How to deal with the really fundamental challenges to the industry, such as insurance fraud?
An important area where a benefit is emerging is in management of claims, and telematics reporting being used to make the claims process more efficient. This was the subject of a recent forum organised by The Digital Insurer at which Generali Group, InsureTheBox and other speakers set out the case for telematics in claims.
At the meeting Charlotte Halkett, General Manager Communications at InsureTheBox commented that the industry is now firmly at the stage of building faster processes around claims, using telematics.
“One of the most exciting areas of telematics is around behaviour modification, making customers safer driver. We take speeders on our books through a very specific process, with particular communications related to excessive speeding…..With this programme we’ve been able to reduce the risk in our speeding book by a factor of 15-times.”
She added that InsureTheBox recently celebrated reaching the milestone of 1,000 accident alerts triggered by telematics.
Luigi Barcarolo, Group Head of Connected Insurance Products Roll Out, Generali said there is a clear cut case for building telematics into the claims process as well as other parts of the value solution, such as greater product categorization and new services.
Telematics insurers have a new kind of super-direct communication with the customer, able to communicate with them frequently, if not continuously throughout the journey.
More telematics insurers are looking beyond price towards other levers in the customer relationship, such as continuous feedback to the driver.
“This is a very interesting area for us, bringing feedback to the point of action,” commented Luigi Barcarolo. “Real time alerting also allows a completely different way of managing claims as well.”
At LexisNexis Risk Solutions we are building an interface to the claims management process from the telematics data, where our experience has shown this to be effective in driving efficiency and a faster claims cycle, also in the fraud detection area.
In the case of many smaller claims or crashes, often the insurer doesn’t get informed immediately and therefore becomes exposed to many additional costs or potentially fraudulent actions. The potential to call the customer immediately after an impact has the potential to gather vital information supplementing the telematics impact data – with a range of actions from alerting emergency services to just asking the customer “is everything okay?” or “how many people were in the vehicle?”
Simple questions really help at the trigger point and can give guidance to the insurer, helping to avoid costs related to non-approved repair contractors, legal, car hire or other costs.
Then there is the eCall initiative across the EU that will make compulsory accident alerting for all new vehicles from 2018. This will help the consumer understand more of the benefits and the technologies. We are essentially providing an aftermarket eCall service available on all vehicle makes and models today.
eCall, when it comes, will contribute to getting all these concepts of alerting and the connected car into the mass market and mainstream consumer awareness.
We believe telematics will prove itself to be a major tool in the battle against no win-no fee lawyers, whiplash claims and insurance fraud worth over £850 million a year, just for the motor sector. Currently for every £1 paid in compensation to customers, £3 is paid in legal fees.
Across the insurance world in the UK, insurers uncover 350 cases of insurance fraud worth £3.6 million every day.
But above and beyond this, the challenge for us working with the industry is how to create a telematics-enabled claims process, whilst at the same time keeping the infrastructure for the non-telematics customer. In our experience, insurers will choose a range of FNOL (first notice of loss) alerts that they want: some demanding as much raw data as possible (weather, angle of impact, G-force, speed before and after the impact) whilst others will just require reports of major events.
False positives, for example when a driver hits the kerb or a pothole, are another area we are working on with our customers. But even this type of minor incident gives the insurer a reason to call up the consumer via the call centre, just asking them if they are okay, driving the customer relationship and loyalty.
At LexisNexis we are helping insurers and their claims handling partners to understand how to use telematics in the FNOL processes, to reduce the cost of claims and the cost of claims processing.
Visit the LexisNexis Risk Solutions website to find out more about how we support insurers.