3 benefits: Crash detection for auto insurance carriers

Last year, Arity subject matter experts (SMEs) predicted what was ahead for the auto insurance industry:

• Auto insurance rates would continue to rise
• Consumer shopping would continue to rise
• Carriers would look for ways to minimize costs

Fast forward to today, those industry predictions have become reality – and the severity has exceeded our forecast. This year:

• Auto insurance rates experienced their biggest annual increase in 47 years
• Auto insurance shopping and switching reached new highs
• As a result, top insurers have resorted to mass layoffs to help control costs

While insurers have turned to raising rates and reducing overhead expenses to combat heightened claims costs, it may be time to look for new, innovative ways to counteract. Investing in technology that can help curb costs and retain loyal customers can be a smart move for insurers. Here are three ways crash detection can help.

Benefit #1 – Gain and retain customers

The correlation is clear – as auto insurance rates increase, so does consumer shopping and switching. However, interestingly, price isn’t always the bottom line when it comes to choosing a carrier.

Arity’s 2022 Consumer Survey found that “trust” and “price” are the leading reasons for why auto insurance customers choose their current provider. Trust beat pricing by a narrow margin, which shows that a company’s commitment to its customers is vital for gaining and retaining business.

Crash detection helps carriers connect with customers in a meaningful way, with a promise to help them when they need it most. With the right solution, carriers can enable near real-time responses to an accident, which can include alerting emergency services, notifying loved ones, sending helpful content, and even kickstarting the claims process.

These services can help insurers build trust and a stronger relationship with their current customers while also enhancing their value proposition to new customers.

Benefit #2 – Expedite the claims process

In addition to establishing loyalty and winning over new business, crash detection can give insurers a new way to take control of costs by expediting the claims process.

With crash detection responses enabled, carriers can not only ensure their customers are safe after a crash, but they can also start the claims process at first notice of loss (FNOL).

For instance, as soon as an accident is detected, an insurer can pinpoint important details like date, time, and place and guide customers through the claims initiation process – including steps for what types of information and photos to capture.

Immediate action after a collision can benefit the insurer and policyholder, saving time and money on both sides by making the entire process more efficient. This is important since the claims process is often the only touchpoint customers have with their insurer.

In fact, a recent Accenture report found that nearly one-third of “dissatisfied claimants” had switched insurers in the past two years, while another 47% said they were currently considering it. A positive experience can further motivate customer loyalty, while a negative experience can sway them to start shopping for another provider.

Benefit #3 – Gain better crash insights

Crash detection solutions can go beyond recognizing and responding to accidents. A good solution can also capture valuable insights that give insurers a better understanding of what happened. Examples include:

• Unreported crashes – Some crash detection solutions can identify lower speed crashes which typically go unreported.
• Date, time, and place – These initial insights can help insurers understand the situation surrounding the accident. Did it occur during rush hour? Did it take place at a known risky intersection or highway? Additional contextual information can be layered on, such as weather conditions to show, for instance, if it was snowing at the time of the accident.
• Preceding behaviors – Crash detection can give insight into the preceding behaviors leading up to a crash including speeding, hard braking, phone handling, etc. to help carriers understand what may have contributed to the accident. This data can also help determine the severity and the complexity of the crash; this information can help insurers determine if a claim should go straight to processing or if it requires further review by a claims examiner.

Crash Detection by Arity

With a mission to make transportation smarter, safer, and more useful for everyone, Arity has been saving lives on the road with our own crash detection solution since 2018.

Crash Detection by Arity is informed by over a trillion miles of driving data, enriched with 90+ years of insurance claims data. We partner with mobile apps, cities, and insurers to detect crashes and enable life-saving responses.

In 2022 alone, Arity detected an average of 23,000 crashes and helped dispatch 2,900 emergency vehicles each month.

For our auto insurance partners, we can go beyond reacting to crashes to proactively prevent them from happening in the first place. Our suite of telematics solutions can help insurers price drivers more accurately with how they drive, which incentivizes risky drivers to make safer decisions behind the wheel.

Interested in crash detection? Contact us to start a conversation!