Two Telematics Companies Partner for usage-based Auto Insurance Solution
September 05, 2012
Telematics, or car-based networking systems, have revolutionized the way we communicate, navigate and control on-board car systems such as entertainment. The technology has also revolutionized the way we are insured as drivers.
Increasingly, insurance companies are relying on usage-based insurance (UBI) programs to monitor policy holders driving and award them for safe driving practices. (In other words, these systems know if you frequently stop fast or take turns too fast, both indicators of unsafe driving.)
This week, two companies in the insurance telematics space have formed a strategic alliance to provide personal lines auto insurers with data and solutions for usage-based insurance programs.
Towers Watson and Hughes (News - Alert) Telematics, Inc. (HTI) have partnered to allow companies to bring UBI programs to market sooner. Towers Watson offers a service called DriveAbility, which provides analytical support for insurers that translates to an individual score for each vehicle. Hughes Telematics has a product called In-Drive, a set of connected services with a simple, self-installed telematics device.
UBI programs are on the rise among auto insurance providers. Insurance companies find them appealing because it allows them to help control claim costs, enhance pricing sophistication, improve profitability and differentiate policyholder products and services. The programs use a self-installed device in the vehicle to collect valuable driving data and provide innovative, connected vehicle data services.
The programs are good for insured drivers (at least for the good drivers). Safe drivers can use these self-installed devices to demonstrate safe driving habits to insurance companies and lower their rates.
“An effective UBI program should offer valuable vehicle services, as well as the ability to reward dependable drivers,” according to Robin Harbage, leader of Towers Watson’s UBI consulting practice. “Working together, Towers Watson and Hughes Telematics bring extensive knowledge to help insurers determine how to best implement a UBI program.”
“This alliance will leverage HTI’s strength in automotive telematics and Towers Watson’s analytical expertise to deliver cost-effective UBI data services for the automobile insurance industry,” said Kevin Link, senior vice president of Hughes Telematics Inc.
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Edited by Brooke Neuman
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