Here’s How General Motors Is Leveraging the Power of Connected Vehicles
Connected vehicles are a rapidly growing sector of the overall Internet of Things ecosystem and are only going to become more prolific as time goes on.
At the close of 2021, there were approximately 237 million connected vehicles in operation around the globe and the market is predicted to be worth $121 billion by 2025. By 2030, 96% of all new vehicles shipped worldwide will come with some form of connectivity already built in. Even today, here in the US, nearly a third [31%] of cars on the road are IoT enabled, showing just how important connected vehicle technology is becoming.
While connected vehicles come with a score of different advantages for the owner, such as downloading software updates, or allowing cars to communicate with infrastructure to warn of traffic disruptions such as tailbacks or accidents, one which perhaps doesn’t get as much attention is the power of the data they produce.
General Motors
However, one vehicle brand which is very much aware of this potential is auto industry stalwart, General Motors. The legendary Detroit, Michigan based motor company was founded by William C. Durant way back in 1908 and, despite some ups and downs, has been a steady presence in the industry ever since.
Through its OnStar digital services and insurance brand, General Motors has designs on leveraging the power of connected vehicle to offer the next generation of telemetric based insurance products. OnStar is already in a powerful place to launch this transformation thanks to having access to General Motors customers, the superior quality of General Motors vehicle data, and the multi-sector ecosystem and brand identity which comes from being part of the General Motors family.
OnStar is looking to use these factors to offer customers a more personalized kind of insurance where premiums can rise and fall in line with their real-world driving behavior. Connected vehicles can also automatically record and upload data relating to accidents when they occur and can make sure OnStar has the most accurate and objective information available to help settle claims. They can also contact emergency services or breakdown providers to assist driver with injuries and/or getting their vehicles repaired in the most rapid and convenient manner possible.
And then there are the updates. In the future, it’s likely product recalls will become a relic of a bygone age. If there is a fault with your vehicle, there will be every chance it can be resolved remotely – without ever having to take your car into a garage. Much in the same way the IoT is empowering field service technicians to carry out repairs from afar, cars will soon be following suite. Sensors within the engine will also enable predictive maintenance and warn of failing components early on – reducing the likelihood of insurance claims in the first place.
RootReady
Another part of the connected vehicle and insurance puzzle comes from General Motor’s partnership with telematics and insurance provider, RootReady.
From June 2021, owners of General Motors vehicles built after 2015 can opt into the RootReady program using the data their connected vehicle is already gathering – previously RootReady would only use data recorded by its own app during a test drive to calculate premiums and coverage.
"The user experience for RootReady is still contained within the app," said Director of Business Development at Root, Maria Martonffy. "The app informs drivers with eligible vehicles that they can skip the test drive and asks if they want to proceed with RootReady. More than 85% of drivers prompted with RootReady chose the immediate quote rather than the test drive, according to the June 10 press release."
The data can then be used to, in a similar fashion to the OnStar platform, provide usage-based insurance. Customers today are increasingly gravitating to those brands which can offer them the most personalized products and experiences possible, and this extends to their car insurance.
People don’t want to pay for something they’re not using – especially since the COVID-19 pandemic transformed how people work and travel – and want to be able to customize insurance products to individual need.
"We are full telematics first, which is why specifically for this program, it's such a nice option for users to be able to have the benefit of being quoted fairly on telematics instantly," added Martonffy. "They get to use the car they already have to get this immediate quote. That is fair and final and quick."
Final Thoughts
Personalized and usage-based insurance is going to become the default setting in the future and brands need to find ways to tailor products to individual customers and their families. Connected vehicles are providing an elegant way to leverage data to make this possible – without requiring any additional input from drivers.
You can hear General Motors Head of Customer Acquisition and Insights for OnStar Insurance Deidre Watts speak at Digital Insurance Summit 2022, taking place in May at the Renaissance Chicago, IL.
Download the agenda today for more information and insights.