Any business in any industry is subject to the limitations of the technology available to bring products and services to consumers. The most sophisticated businesses are those that find the most economic utility from the technology available while pushing for further advancements to bring further competitive utility to the organization.Executive SummaryWith the cost of telematics technology falling, telematics programs in the insurance industry have shifted from short-term monitoring for upfront auto insurance pricing to continuous engagements with customers. Benefits to customers include rate transparency and control over premium as well as better awareness of risk reduction tactics, while insurers gain on the claims side. Nearly instant crash data combined with machine learning insights increase the speed of claims handling from intake to resolution.
The largest catalysts in any industry come when new technology changes economic realities of businesses. Everyone in the insurance industry has experienced this over the course of the pandemic as we have been forced to work from home with minimal productivity loss due to advancements in video conferencing and online collaboration tools.
In some cases, macro changes in strategy can be easily observed from the evolution of technology. The most obvious examples include distribution, where new tools opened up to the industry as new companies arose to take advantages of the technology to acquire customers. In pricing, there have been a number of new innovations that have enabled insurers to better price risk. But there is likely no better example than the evolution that has happened in the telematics space and the major shifts in strategy that those changes are powering today.