Why Usage Based Car Insurance Programs Are So Popular
Telematics have become a common device for cars. This advanced technology has the ability to change every aspect of the insurance value chain as we know it and changes have already been made. And this type of insurance it seems to get the upper hand. Find out why usage based car insurance programs are so popular. Furthermore, get free quotes from the best car insurance companies and check their offers.
According to a report by IHS Automotive, the number of consumer subscribers to UBI will reach 142 million globally by 2023, up from nearly 12 million in 2015. Currently, the US – the largest car insurance market in the world – leads the way with 5 million UBI policyholders in 2015, with markets in Italy and the UK coming in at a distant second and third.
Through its use of real-time information on both where and how someone drives, UBI offers numerous benefits to insurers and customers alike. For consumers, it offers them the chance to control the price of their insurance premium. It will also provide faster accident assistance and support should an incident occur. However, research has shown that the use of telematics actually drives down the number of accidents as well as their severity. For insurers, UBI means improved risk selection, reduced claim handling costs by around 55%, efficient fraud detection and ever-increasing customer interaction – which, in turn, will help boost both retention and brand loyalty.
Connecting insurance premiums more closely to actual individual vehicle or fleet performance allows insurers to more accurately determine the cost of insurance. This increases affordability for lower-risk drivers, many of whom have limited financial possibilities. It also gives drivers the chance to control their insurance costs by encouraging them to reduce miles driven and adopt safer driving habits. Fewer miles and safer driving also aid in reducing accidents, congestion, and vehicle emissions, which benefits all of us.
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