3 Ways Technology is Changing the Car Insurance Industry

 

Close up hand of woman holding smartphone and take photo of car accident

You’re probably familiar with the many ways technology is changing how you drive – whether it’s driver assist technology helping you make decisions behind the wheel, built-in cameras giving you a 360-degree view of the road, or energy-efficient advances helping you spend less on gas. But new technology isn’t just changing the way you drive, it’s also changing the way you’re insured. Read on to learn about three advances in technology that are revolutionizing the auto insurance industry.

Telematics devices

What if you could prove to your insurance company that you are a safe driver – and reduce your premium as a result? That’s exactly what insurers are offering with Usage-Based Insurance (UBI) plans. Under this type of plan, drivers install a telematics device in their car to record information about their habits behind the wheel. In return for their data, drivers qualify for a small discount to their premium upon signing up for a UBI plan, and a potentially larger discount when they renew – depending on their habits. If you’re hesitant to share this much information with your insurance company, read these news stories:

  • One insurer reports that 70 percent of drivers with this type of plan earn some kind of discount.
  • A study by the University of British Columbia showed that real-time driving feedback resulted in better habits for most participants.
Something to also be mindful of is that insurance companies are not allowed to use the information they collect to raise your premiums or deny you coverage – only  a discount.

Machine learning

Thanks to the internet, shopping for insurance is easier than ever. There are many sites online that will allow you to quickly compare multiple quotes from insurers so that you can find the best – and most affordable – plan. When it comes to servicing clients online, one company that is leveraging machine learning to raise the game is Kanetix Ltd.

Machine learning refers to a type of artificial intelligence in which computers are programmed to “learn” by themselves as they are exposed to more data and new experiences. In this case, Canadian firm Kanetix Ltd. partnered with Integrate.ai to offer customized buying experiences to their users. Leveraging their website’s deep pool of data, they were able to predict a customer’s likeliness to purchase insurance – and tailor the next steps of their buying experience based on the information. The result? A win-win scenario for Kanetix, which saw an increase in lead generation and marketing ROI, and their customers, who benefited from an improved online experience.

Autonomous vehicles

Experts have predicted that self-driving cars could save Canadians $65 billion a year in reduced fuel costs, fewer collisions and decreased congestion, making autonomous driving technology an exciting trend. Even self-driving cars, though, will require human co-drivers who are paying full attention, otherwise, they’ll still be susceptible to collisions – like in this case where a Tesla Model S that was in autopilot mode caused a fatal highway accident. So what does this mean for the auto insurance industry? Insurers will need to have policies in place to determine who is liable for an accident that involves an autonomous vehicle: the maker of the vehicle or the human driver. U.K. lawmakers have proposed a vehicle technology bill that suggests the manufacturer of a self-driving car could be liable in some instances, rather than the ‘driver.’ Under the bill, insurance companies would need to offer two types of insurance for autonomous cars: one to account for when the car is operating on its own, and one to provide coverage when the driver takes over.

 

For the most part, these trends are just emerging, so it’s impossible to say for certain what the car insurance industry will look like as technology advances. It’s safe to say,  that as we change the way we drive, there will be many new opportunities and challenges for insurers in the future.

 

 

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Do You Need Taxi Insurance

 

Looking for the short answer? Yes! If you drive a taxi for a living, standard car insurance policies do not cover your needs. They will not protect your customers, your car – or you – in the event of an accident or incident. You need specialist coverage like taxi insurance to ensure that your livelihood is safeguarded.

Public or Private Taxi?

 The specific type of taxi insurance cover you need depends on the type of taxi you drive. It may be private (i.e. booked in advance) or public (i.e. those that can be hailed by people on the street and do not require pre-booking). You must have public taxi insurance if you pick up customers without booking – even if you typically only do private hire.

                                       

                                    What Level of Protection Do You Need?

 

Just like regular motor insurance, taxi cover has three levels:

Comprehensive: This is the most… well, comprehensive cover you can purchase. It covers accidental damage to a third-party property, and typically also personal injury, windscreen damage, personal possessions and more. So, for example, if you cause an accident, this will pay for the damage to the other vehicle as well as your car and any third property damaged (e.g. a wall, a fence, etc.).

Third Party, Fire and Theft: This insurance protects you against damage you cause other drivers, as well as damage caused by fire or theft. What it does not cover is the damages to your car in an accident.

 Third Party Only: The most basic cover, this only pays for damage to vehicles you damage in an accident, as well as passengers in your car who may have been hurt. As a taxi driver, you should carry a much higher level of protection.

Comprehensive is best in terms of protecting your income,  choose from key add-ons:

 

Unlimited Mileage: Depending on how much you drive, this can be worth it so you do not exceed your cover.

Public Liability: This should be included in your taxi insurance policy; it covers you if a passenger has an injury or damage to property while in your vehicle. It also covers claims that may result from those incidents.

Personal Use Cover: If you use your taxi as a personal vehicle on off days, invest in this protection.

 Taxi Insurance Criteria

 Depending on your insurance company, you may have to meet some or all of the following criteria:

 

  • Held a taxi badge for at least 1 year.
  • Held a driving license for at least 3 years.
  • Lived in the UK for at least five years.
  • Work as a full-time taxi driver.
  • Are 25 years of age or older (though some policies specify 21).
  • Passed Driving Vehicle Standards Agency taxi driving test (if applicable).

 

 

If you drive a taxi for a living, ask your insurance company about specific cover. It is required by law, and it is a smart business move. Protect your passengers, your vehicle and yourself.

 

 

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