Auto insurance in the new mobility ecosystem: 3 takeaways from Insurance Innovators USA

If you walked away with only one takeaway from Insurance Innovators USA 2023, it should have been: Innovators win. That sentiment came across clearly in every session.

Look no further than what keynote speaker Stefan Holzberger, Chief Rating Officer for AM Best, said on Day 1: “Innovative insurers are leveraging technology to enhance premium growth opportunities and better operational efficiency compared to peers.”

Then, session after session, “insurance innovators” took the stage to speak on how they’re accomplishing that, including our Director of Product and Growth Marketing, Louisa Harbage-Edell.

Check out three key takeaways from her panel discussion, “Insurance in the new mobility ecosystem: A world of innovation” alongside leaders from Canal Insurance Company, Jerry, Porsche Auto Insurance, and Volvo Financial Services:

#1 Telematics: The future of auto insurance is happening now

When asked the question, “Which mobility innovations are having the biggest impact on insurance right now?” Louisa – along with other panelists – unanimously agreed on telematics.

Leading carriers are already investing in telematics and sophisticated pricing. So, if a carrier isn’t already offering a telematics program, they need to not only start today but also take significant strides to catch up and outpace the competition.

“Having data at time of quote completely changes the game.” – Louisa Harbage-Edell

According to Louisa, carriers will have a hard time attracting customers who are already in an existing telematics program. Those customers are already receiving a personalized rate based on their unique driving behavior. To attract and win those customers, a carrier must have access to historic driving data at new business in order to provide pricing based on telematics at time of quote.

To stay competitive in today’s new mobility ecosystem, a carrier needs to think both short-term and long-term. They must have a telematics program in place sooner rather than later, think about how their program is going to outcompete, and plan for how their program will evolve for the future.

#2 Connected car data: The next step to accelerate for telematics success

The next frontier for carriers is partnerships with OEMs.

“We see connected car data as the future. Every one of those in-car sensors transmit such rich and valuable data.” – Louisa Harbage-Edell

For years, Arity has collected driving behavior data from mobile phones because that is where the volume and scalability is. And that continues to be the case today. But with the growing prevalence of connected vehicles – 91% of new cars sold in 2020 were connected – Arity has also expanded its reach to bring OEM data into its portfolio as it plans for the future.

To obtain driving data at scale, however, insurers must either work directly with multiple OEMs, juggling various contracts and managing and merging disparate data sources, or find a partner who aggregates that data and can also help them sanitize, ingest, and derive insights from it.

Offering telematics data originated from mobile apps consumers use every day as well as connected car data from new Toyota and Lexus vehicles thanks to partners like Connected Analytic Services, LLC (CAS), Arity is the leading partner in providing telematics data at time of quote.

The Arity and CAS partnership drives value for connected car vehicle owners and auto insurers through:

1. Offering the most predictive measure of driver risk to date, which can improve an insurer’s bottom line
2. Protecting customers and promoting safer driving behaviors, which can help insurers increase customer retention with a stronger value proposition
3. Empowering customers by providing them greater control over their auto insurance rates, so that they can receive fair and accurate pricing

#3 New driving behavior data: The rise of autonomous vehicles

The rise of autonomous vehicles has just begun. But it won’t be successful without data.

As vehicle autonomy progresses, insurers will have to reevaluate personal versus product liability and consider questions like: Were those automated features turned on? Was it the person or the vehicle assist functionality that was responsible?

One recommendation is to rely on telematics data to start to understand how autonomous vehicles and features are affecting accident frequency and severity. And according to Louisa, insurers with connected car data already have a leg up when it comes to identifying and measuring that risk.

Innovators win: Arity’s role in the new mobility ecosystem

Louisa’s panel discussion at Insurance Innovators 2023 gave auto insurers a glimpse of what’s happening now in the new mobility ecosystem – and what to expect in the near and distant future.

Since the founding of Arity, our team and our data has helped shape the future of mobility from fueling some of the first telematics programs, to analyzing shifts in mobility trends and habits, to launching Arity IQ^SM – which offers the most accurate predictive measure of driver risk at time of quote.

Moving forward, we will continue to innovate and lead the evolution of auto insurance telematics. With our solutions, we help carriers take full advantage of telematics and the holistic value it brings across the customer lifecycle.

Ready to learn more? Check out Louisa’s blog, co-authored with our Sr. Manager of Product Marketing, Robert Lee, to learn how auto insurers can leverage telematics to improve pricing sophistication at time of quote.