Telematics and usage-based insurance have evolved greatly in the past few years, but it has yet to be determined whether people will willingly share personal data for financial benefits.
New York, NY (Nov. 25, 2013) – In the report Innovation in Focus: The Great Telematics Experiment, Celent examines the nature of telematics and usage-based insurance in the motor industry and explores what is on the immediate horizon. Celent also looks at the two principle hypotheses held by the industry regarding the future of this most prominent line of business, presented in the report as the null hypothesis and the self-selection hypothesis.
The rise of Foursquare, Facebook, and other location-based services suggests that people are willing to divulge personal data in a public forum. Will they do the same to get access to discounts for motor or auto insurance? This is the great experiment being conducted globally by the insurance industry. Put simply, we don’t know the answer yet.
“There are experienced insurance professionals with decades of experience who fervently believe the null hypothesis,” says Craig Beattie, Senior Analyst with Celent’s Insurance Group and author of the report, “Equally, there are experienced insurance professionals with decades of experience who fervently believe the self-selection hypothesis. There are others happy to wait and see how it plays out.”
The report also includes results of a survey on how receptive customers would be to real-time feedback on their driving.
The report examines how telematics is evolving and explores two opposing views on its future place in personal lines insurance. This is a brief report intended as a companion to the webinar Telematics and UBI: Some Risks or All Risks.
Visit Celent for more information: Innovation in Focus: The Great Telematics Experiment.
Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies (NYSE: MMC).