Electric Insurance Company has partnered with Cambridge Mobile Telematics (CMT), a global technology provider using advanced mobile sensing, data analytics and behavioral science, to develop and launch a telematics insurance program.

Telematics is a combination of the words telecommunications and informatics. Telematics, in a broad sense, is any integrated use of telecommunications with information and communications technology. It is the technology of sending, receiving and storing information relating to remote objects – like vehicles – via telecommunication devices.

Electric Insurance utilizes telematics in CMT’s DriveWell platform to launch Great Driver, an easy-to-use smartphone app. The app analyzes users’ driving skills and environment and provides actionable, individualized feedback to help improve driving habits and safety. With continued use, the app assigns a score that can potentially provide a discount based on individual driving skills and risk levels. Obtaining this kind of data also helps insurers more accurately estimate accident damages and reduce fraud by enabling them to analyze the driving data (such as hard braking, speed, and time) during an accident. Besides Electric, Progressive Insurance has also created a program called Snapshot using this technology.

As a result to this new innovation, auto insurers like above have created Usage-Based Insurance (UBI) plans that more closely align driving behaviors with premium rates for auto insurance. UBI programs offer many advantages to insurers, consumers and society. Linking insurance premiums more closely to an actual individuals’ vehicle allows insurers to more accurately price premiums. This increases affordability for lower-risk drivers, many of whom are also lower-income drivers. It also gives consumers the ability to control their premium costs by incenting them to reduce miles driven and adopt safer driving habits. Fewer miles and safer driving also aid in reducing accidents, congestion, and vehicle emissions, which benefits society.

UBI is poised for rapid growth in the U.S. and according to SMA Research, approximately 70% of all auto insurance carriers are expected to use telematics UBI by 2020.

One of the challenges to insurers is managing regulatory requirement within the states that they do business and implementing these UBI programs into their software. DRC’s GameChanger® Rating Enterprise has the flexibility to incorporate the big data from telematics to quotes quickly and efficiently.  The GameChanger architecture allows for easy configuration by business analysts and subject matter experts to develop a new product or simply incorporate the additional information into the rating calculation.

GameChanger is a flexible solution that is available as an integrated, end to end suite, as individual components, or as a customized solution to meet your specific needs.  GameChanger is designed for carriers, MGAs and brokers writing personal, commercial and specialty lines of business in the P&C Insurance Industry.

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