The Friday Five

July 6, 2018

Every week The Friday Five will bring you interesting news and information from around the insurance industry.

State Auto First Carrier to Participate in Road Assist+ Program

State Auto Insurance Companies has become the first carrier to participate in Mitsubishi Motors North America’ new smartphone app, Road Assist+, a program designed to enable drivers of Mitsubishi autos to get the benefits of usage-based insurance without having to install telematics devices in their vehicle or buy a newer connected car model. The app collects driver behavior data via LexisNexis technology, then communicates the data as feedback to drivers and to insurers that participate in Mitsubishi’s Roadside Assistance service. The Mitsubishi Road Assist+ app delivers the driving data to drivers who can choose to make the data available to insurers through the LexisNexis Telematics Exchange. State Auto expects to get started using the capabilities within the next several months. Read the Digital Insurance article by Peggy Bresnick.

Will Self-Driving Car Manufacturers Enter the Auto Insurance Ring?

Bernard Fraenkel, a member of the influential Forbes Technology Council, published an opinion piece on Forbes that foresees self-driving car manufacturers (SDCMs) taking a more active role in providing insurance to their customers. According to Fraenkel, SDCMs are motivated to remove one of the biggest barriers to adopting self-driving cars – the cost and availability of auto insurance. Traditional car insurers cannot simply offer insurance for self-driving cars without proper accident/fatality statistics, and even those companies brave enough to offer such a product might set high initial costs, Fraenkel explained.

On the other hand, SDCMs are well-positioned to provide auto insurance to their customers, since they already have the data at hand. Read Lyle Adriano’s Insurance Business America article, Influential Council Predicts Car Manufacturers Will Decimate Auto Insurance Commissions.

Texas’ Hail Problem Causing Big Losses

Excerpted from Stephanie Jones’ Insurance Journal article, Dealing with It: Texas’ Never Ending Hail Problem: On June 6, a hailstorm walloped heavily populated areas of North Texas with baseball sized hail and served as a reminder that the state is one of the most hail-prone in the nation. Dallas, Tarrant and Denton counties suffered the brunt of the storm, which racked up around $1 billion in insured losses to residential and commercial properties and automobiles, according to Karen Clark & Co.  Nationally, hail losses totaled $8.4 billion in 2016, the highest since 2011 the [LexisNexis] Home Trends Report shows. That’s a 44 percent increase in loss costs from hail over 2015 levels on a national basis.

Hurricane Season Forecast Changes for the Better

Good news for homeowners and insurers alike: The 2018 Atlantic hurricane season should be quieter than normal, according to a new prediction from Colorado State University released on Monday. Meteorologist Phil Klotzbach and other experts from the University’s Tropical Meteorology Project predict 10 named tropical storms will form, of which four will become hurricanes. That is a sharp decrease from their forecast in April, when they said 7 hurricanes would form. If the quiet forecast comes to fruition, 2018 will be a welcome relief after the destructive 2017 season, which saw monsters like Hurricanes Harvey, Irma and Maria tear paths of death and destruction across the Caribbean and the U.S. Read Doyle Rice’s USA Today article, Atlantic Hurricane Season Forecast Changes for the Better with Fewer Storms Predicted.

Is America Ready for Ridesharing in Self-Driving Cars?

Excerpted from How Much Americans Could Save by Ridesharing Driverless Cars Over Owning on Self-driving cars promise safer roads, less traffic and increased mobility.

Some autonomous vehicle proponents also maintain they will save time and money. But will they really save Americans time and money? And even if they do, are Americans ready to give up driving? The reality is that the first fully autonomous cars will be very pricey and beyond the reach of most Americans. Manufacturers expect the early buyers will be businesses and the very wealthy. One developer says prices won’t start coming down enough for most families and individuals to buy them until 2025 or beyond. Until the price of ownership of self-driving vehicles comes down, most people will experience driverless vehicles through ridesharing, according to researchers.