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The future of car insurance
Data-driven insurance providers can offer products which are significantly better suited to customers who have come to expect flexibility in both pricing and service from their insurance providers.
Considering the speed with which other industries have adopted AI and app technology, it is in some ways surprising how long it has taken the insurance industry to jump on the bandwagon. The difference a car data-driven approach could make to small but necessary tasks like mileage tracking and claims verification would significantly improve the experience of car insurance customers.
Despite this slow start, car insurance apps are beginning to make an appearance alongside other mobility applications for car owners with a broad range of services now on offer. Esurance DriveSafe is a tool for parents to monitor their teenage children driving for the first time, whereas Allstate Motor Club offers an app that uses your phone’s GPS to locate your vehicle and send help if you are stranded or your car breaks down. Allstate also offers the Drivewise mobile app; a nifty idea that tracks driving behavior and rewards the driver for being responsible behind the wheel. Allstate customers can earn discounts or cash back on their premiums. Crucially, Drivewise is also available to those not insured by Allstate: these users can earn reward points and redeem them for merchandise, gift cards and other items.
What we can be certain of as applications in the car insurance space become more targeted, efficient and data-driven is that the increased monitoring of our driving will only be a good thing for good drivers. Rather than insurance rates being calculated based on age, gender or number of years on the road, using real car data insurance rates can be set based on driving alone — a significantly fairer method of assessment.
Let’s take a look at the Auto API and how it will enable insurance applications to connect with real cars on the road.
Connecting to mileage data
Up until now it has been difficult to get accurate mileage and location information from cars, an issue that has prevented providers from offering insurance that reflects the type and actual usage of vehicles. This inaccuracy of data is primarily because mileage has been tracked either via aftermarket hardware or entered manually.
Below is a sample Pay-as-you-drive (PAYD) insurance data bundle. If you’re not building a PAYD insurance application, the Auto API can also supply details of the actual state of the car via several other data points.
A message sample using the Diagnostics category of Auto API:
To get the Diagnostics state of the car (including Mileage) the ‘Get Diagnostics State’ command is sent from a smart device to the car. The car then responds with the Diagnostic state, including the car mileage (odometer) in kilometres.
A bonus data point: Vehicle Status
The Vehicle Status has a variety of uses for a car insurance app. Eliminating the need for extensive paperwork for both the company and the customer, this API can provide all the details needed about the vehicle’s status, from the model name, powertrain, licence plate number, model year and colour of the car all the way through to the number of doors and seats. When filing a claim or registering a vehicle for a new service these details could be easily verified without the need for extensive checks or filling out forms, improving the user experience for the vehicle owner and speeding up processing on the administration side.
Use the Vehicle Status either through the SDKs or the REST API to get the state. Below is a JSON response example:
