Auto insurers have excellent opportunities to improve the bottom line this year with the use of better, more accurate data.
Telematics is data concerning travel, including driving behavior. This summer, LexisNexis has enabled the ability to bring in a policyholder’s telematics data at the point of quote with Telematics OnDemand. This is an advanced feature for auto insurers, which allows an even faster customer experience and more accurate results when offering Usage-Based Insurance (UBI) policies.
WaterStreet Company can integrate with data sources like LexisNexis, allowing all of our participating P&C Insurance Companies to take advantage of this third-party solution during the policy administration workflow.
Telematics at the Point of Quote
A current challenge for auto insurance companies is how to best implement telematics data.
Some auto insurance companies allow the driver to download a mobile app so that after the driver receives their quote, they’re able to share driving data at a later time. This requires additional time for a monitoring period of the driver’s behavior and could lead to the cost of the insurance changing after the quote is given to reflect the real data shared.
However, LexisNexis allows auto insurance companies to bring this data into the initial quote experience. The process calls for the policyholder to engage with their automaker for connected services. The driver can then consent to sharing this data with auto insurance companies. The following auto makers participate in the LexisNexis Telematics Exchange, which enables this data sharing:
- General Motors
- Mitsubishi Motors North America
- Nissan North America
In addition to these automakers, LexisNexis connects to additional mobile apps and third-party services for gathering telematics data at the point of quote.
Why Offer UBI?
Usage-Based Insurance (UBI) policies are highly attractive. Rather than the insured paying the same monthly premium, they’re able to pay as they drive. Premiums can be a different total each month.
Auto insurers must have real-time access to the driver’s telematics data for this insurance offering to work. When the driver is not driving, they won’t have to pay for coverage. In the case of other accidents when the car is not in motion, such as if a tree falls on the car or if another car hits the policyholder’s car while parked, typically either homeowners insurance or the at-fault driver must provide coverage.
The Benefits of Real-Time Telematics Data for Quoting
Without real-time telematics data at the point of quote, there’s a gap between when the policyholder receives a quote and when the auto insurer receives accurate driving behavior data.
When the insurer brings telematics data into the start of the enrollment process, they can accurately calculate risks before coverage starts. Relying on data that has been previously collected gives auto insurers a better picture of the driver’s behavior. This improves risk segmentation, rating and pricing, and insurers can choose to offer UBI by continuing to monitor telematics data.
The time it takes to engage with the policyholder during enrollment is also reduced with Telematics OnDemand. The process to consent to sharing telematics data is in near-real time, allowing the policy administrator to efficiently quote the customer.
2020 has called for policyholders to shop around for the best deal according to their new driving habits. As commutes have lessened due to staying at home, many policyholders have sought to reduce the costs associated with their cars. The Telematics OnDemand solution by LexisNexis allows auto insurance carriers to offer competitive pricing and a positive customer experience for enhanced loyalty in the wake of shifts to the industry.
WaterStreet & LexisNexis
The robust API behind our P&C Policy Administration suite allows us to connect any number of third-party solutions to your policy administration workflow.
We aim to increase efficiencies across your company through our fully integrated cloud-based core system.
Reach out to WaterStreet Company today to request a consultation and demo.