The perks of usage based insurance policies for vehicles can go beyond just availing the insurance at the best prices. These policies can also help in curtailing fraud and inform policy holders about fuel consumption, CO2 emission, and other aspects that reduce the driving costs, says a recent Celent report.
The recent Celent report titled “Telematics-Based Insurance: Has the time finally arrived?”clearly mentions that all insurance providers are clearing any obstacle that comes in the way of offering usage based auto insurance policies to their customers. Celent also goes on to say that the cost involved in purchasing the devices, installing and servicing them has come down drastically and will continue to fall in the coming months. It is now easier than before to transfer critical data from these devices to the insurance provider. Customers do not have to manually transfer the data to their computer and then to the insurance provider since the data can be sent easily over any 3G network.
Celent also claims that privacy concerns have also dipped considerably. The customer privacy concerns seems to have been put to rest by the fact that they will have to pay lesser premiums for these insurance policies. Citing as an example, Celent said that one of the surveys conducted by Towers-Watson clearly shows that over 66% of the drivers in the country are willing to change their driving habits if they can get a 10% discount on their premiums. Of these 66%, 76% of the customers are willing to have a device installed in their vehicle to monitor and track their driving habits.
Celent says that with all obstacles overcome, usage based auto insurance will surely gain popularity. Continuing further, it says that insurance providers who fail to offer these policies to their consumers will end up offering insurance to poor drivers who grade well if the traditional rating factors are used. The report also says that insurance providers can benefit in more ways than one. In addition to offering accurate premiums for their policies, this policy will also help in curtailing the number of fraudulent claims. For example, the data from the accelerometer can be used to arrive at the G-force during the time of collision which helps in settling whiplash claims at the earliest without any hassles. This also minimizes the interferences by third parties and helps in processing the claims faster.
