This IDC Financial Insights report explores the allure of utilizing vehicular telemetric black boxes in motor insurance and how Pay-How-You-Drive (PHYD) policies stand to benefit both the insurers and the insured alike. However, as with all disruptive technologies, these do not come without some challenges.
To understand why this is so, IDC Financial Insights examines most recent industry developments that are promoting telematic-based policies. This document also discusses growth trajectory and user adoption of telematics, and key telematics insurance providers across the globe. It concludes with suggestions on how insurers can utilize telematic technologies to capture attractive customer segments and build upon their long-term strategic advantage.
"There remain issues surrounding data privacy, cost, and lack of customer data, and there is a measure of industry and policyholder skepticism toward PHYD policies. However, given the advancement in automotive technology, the utilization of smartphone in replacement for telematics hardware components, and recent regulatory mandates, telematics insurance should evolve to a mainstream product in the medium term. This is particularly so in industrialized European nations such as the United Kingdom and Italy, as well as in the United States," commented Li-May Chew, CFA, associate research director, Worldwide Insurance Advisory Service.
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IDC Financial Insights: Worldwide Insurance Strategies , IDC Financial Insights: Worldwide Risk Management Strategies , IDC Financial Insights: Worldwide Risk and IT Infrastructure Strategies
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