Metromile Is Using Data Telematics to Transform Insurance
We can expect to see telematics technology become ever more ingrained in our daily lives as time goes on. As we demand increasing levels of connectivity from our everyday devices and products, telematics becomes the natural solution.
For the uninitiated, telematics refers to any device which brings telecommunications and informatics together — usually in a vehicle. It covers a wide range of devices including GPS and navigation systems to the technology which now allows for wireless television and internet connections within your car. It's thanks to telematics that, should you misplace your car keys, you can now call a customer service line and have them remotely unlock your vehicle for you.
Telematics is made possible by the seamless merging of data and communications technology. It holds great promise for the future of in-car tech, and Metromile is putting it to great use in its pay-per-mile insurance offering.
Metromile
Having long been ahead of the curve when it comes to the innovative application of technology, Metromile knows first-hand the potential of telematics.
"The concept of telematics is new for many insurance providers and they are still figuring out how to incorporate it in their business models," said Metromile Vice President, Sathish Koteshwar. "It's harder for insurers to pivot — given the size of their organizations, their complex hybrid infrastructure and lack of driving data around their policy holders. Their model is so different than ours, since we've built the very core of its business model around telematics."
The nature of car ownership is changing and the wants and needs of insurance customers are changing along with it. Recent years have seen a significant increase in the number of drivers choosing to lease cars or take out shared mobility plans in lieu of traditional car ownership, which has created a need for more flexible insurance options.
To meet this need, Metromile has teamed up with one of the world's leading car-sharing marketplaces, Turo. The result of this partnership is a new fractional insurance policy that will allow customers of both brands to pay a base rate plus an added cost for only the miles they personally use the vehicle for. If they're not driving the vehicle, they're not paying anything beyond the base affordable policy rate. On top of this, Turo Insurance Agency ensures coverage for hosts' cars while they're booked, and hosts can save money on auto insurance by not doubling up.
The insurance is made possible via Metromile's Pulse device which is installed into the car's diagnostic port. The data from the device is able to differentiate between different users for the car and charge each based on their individual usage.
In a press release, Metromile said, "We'll use data from the Pulse and the Turo host's calendar to separate personal miles from miles driven on Turo guest trips. Hosts will pay a per-mile rate for the miles they drive themselves plus an affordable base rate. We expect to first launch in Illinois, and then roll out across California, Washington, Oregon, Virginia, New Jersey, Arizona, and Pennsylvania. These eight states collectively represent where more than 40% of Turo hosts are currently located."
Data Driven
While this new insurance innovation represents an amazing use of telematics technology, Metromile isn't stopping there and is also deploying data to provide its customers with AI-powered automatic claims and fraud detection.
"Insurers are spending a lot of money on fraud detection — but they're doing it with an army of humans trying to manually track it down, because they don't have big, high-quality data sets," said Koteshwar. "Hearing that gave me an even greater appreciation for the fact that thanks to our Pulse device we have 100% continuous telematics across all of our policy holders. This data — a 100% footprint of driving/behavior data — prevents so much fraud from happening in the first place, and if it does occur, we're able to quickly root it out. This further enables us to pass these savings to our customers and offer really competitive pricing on auto insurance."
There is no limit to the potential of telematics to benefit every aspect of the insurance industry. From creating bespoke policies that meet the needs of the modern driver to helping make the claims process and fraud detection simpler, telematics is something we'll be hearing a lot more about in the future.
Final Thoughts
"I'm even more excited about our future here at Metromile," concluded Koteshwar. "Our big head start is a huge competitive advantage, and it's definitely going to help us win market share."
You can hear Metromile's Chief Insurance Officer, Jeff Briglia, speak at Digital Insurance 2020, taking place in July at the Renaissance Chicago, IL.
Download the agenda today for more information and insights.
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