The hard truth on insurance and telematics
Whiplash, staged accidents, Ogden, fronting, ghost broking – you name it, motor insurers have been having a rough time of it. Not only that but they have been getting it, rather ironically, ‘in the neck’ for encouraging a compensation culture in the UK that has seen claims costs spiral and premiums reach record-breaking levels.
While Government reforms are underway to help tackle some of these problems, insurers need to be putting greater investment in getting on the front foot at the claims stage. This will reduce exposure to fraud, help avoid inflated claims costs and ensure claims are managed quickly and simply for the customer.
The sure-fire way to do that is through telematics data. The hard truth is that many major insurers simply aren’t geared up to use telematics data at claims stage.
Given the many and varied challenges facing the sector it is fair to assume that if, as an insurer, you have access to the exact details on the circumstances of a claim, recorded by the car rather than relying purely on the customer’s and/or witness version of events, that intelligence would be ingested and used to help determine the outcome of a claim? You would know where and when the accident happened, the G-force on the car, where the car was hit, whether the car was stationary or moving.
It is also fair to assume that if you know a customer has had an accident, you, as their insurer, will want to be the first to offer help.
These are big assumptions and sadly mistaken ones.
The problem is that while the vast majority of insurers now have some form of telematics proposition, whether through a broker partnership or as a distinct part of their in-house capabilities, it is still seen as a niche part of their business and the benefit is limited to how telematics data is used to rate for risk, not how it is used during the claims process.