15 November 2016
Technology and Auto Insurance – 3 Changes in 2017 and Beyond
Although there are still a number of weeks until 2016 comes to an end, this time of the year tends to go by at a very rapid pace. Between the holidays and getting any loose ends taken care of, it often seems like the new year arrives in the blink of an eye. With that in mind, we thought it would be interesting to cover three of the technology trends that are expected to shape the auto insurance industry in the coming years:
1. The Rise of Telematics
The word telematics comes from the combination of telecommunications and informatics. While it’s easy to go down a technical rabbit hole on this subject, we want to focus on what this field means for drivers like you. This technology provides a way for insurance companies to remotely monitor your driving. The current approach that most insurers take is providing a device that collects data for a set period of time. The data is then sent in for review, and if it meets the criteria that an insurance company sets, rates can be discounted by up to thirty percent. As telematics become more common, there is the possibility of insurers using this technology to penalize drivers who fall outside their acceptable guidelines.
2. Proof of Insurance Goes Digital
In a relatively short amount of time, pulling out a phone to show a police officer proof of auto insurance has become a fairly common practice across the United States. This is a practice that will only continue to grow. Although there’s no denying the convenience of having proof of insurance on the device that’s with most people at all times, we still recommend keeping a paper copy in your glovebox as a backup in the event of a dead battery or other issue with your mobile device.
3. Insurance for Ridesharing
It wasn’t that long ago when the idea of pulling out your phone and tapping a button for a stranger to pick you up seemed completely bizarre. However, services like Uber and Lyft have made this method of transportation completely mainstream. The rise of ridesharing has raised a lot of issues such as how these drivers should be classified for tax purposes. Insurance is another area that has presented some interesting challenges.
While the companies behind these platforms provide drivers with liability insurance, there’s a gap when a driver is working but doesn’t have a passenger in the car. Since ridesharing is an area of technology that’s attracting billions of dollars in investments, insurance companies are experimenting with different forms of supplemental coverage that bridge the gap between a provider’s liability insurance and a driver’s personal policy.
If you have any questions about what these car insurance changes mean for your existing policy or have been thinking about making a change to any of the insurance coverage you currently have, don’t hesitate to get in touch with us by calling 513-587-3553.