Data at the core of mobility
Internet of Things, Big Data & Artificial Intelligence will fuel new partnerships and ecosystems in the Insurance industry.
The risk is, that arguably bad drivers prefer to pay for the service rather than ownership, while good drivers prefer to own their car. This would imply, that clients paying for the car as a service carry higher risks, thus the cost would go up. However, in a data-driven world that does not have to be the case as the data will allow for more accurate pricing to reflect a customer’s true risk.
But OEMs and drivers will still be exposed to risk, although it is changing in nature. Systems still fail, accidents still happen, but the factors behind them will change. With all the connectivity and intelligence in modern cars, new risks such as cyber emerge. Collaboration between OEMs and Insurers will need to develop in order to keep pace with the advancements in insights enabled by sensor technology and AI.
Insurers have a relevant role to play
Even for OEMs with a truly unique view into their customers’ risks, insurers have a relevant role to play beyond being a financial carrier of risk. When the customer is involved in an accident, insurers will remain a key bridge between the parties that need to be involved to help the customer through it.
The unique value proposition of the insurer is the knowledge of how to best take care of a customer that has an accident – through the network of medical help, roadside assistance, repair shops, and so on. This “accident care infrastructure” is simply too challenging for each OEM to maintain on their own.
Similar trends can be spotted in other ecosystems as well, where the role of players, including insurers, will change. In the home ecosystem, smart home technology is powering new insight into risks in the home. And in the health ecosystem, smartwatches are enabling new levels of preventive care.
For many companies, when faced with this type of change, it makes sense to consider how well positioned one is to “win” also in the future ecosystem. Is your company ready for the changes ahead? But just as importantly, is your company prepared for the digital risks involved? And are you participating in the change as a driver or as a spectator?