How the top auto insurers tackle telematics in 2021

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Usage-based insurance is a quarter-century year old concept in auto insurance… and what a quarter century it’s been. Over the years, the digital technology required to more closely tie auto insurance rates to driving habits has improved. Early implementations in the UK required modifications to the vehicle to install, suppressing the potential customer base and also lacking sustainability. Plug-in devices brought set-it-and-forget-it convenience, but required a manufacturing and delivery supply chain.

Today, most usage-based insurance launches depend on the ubiquitous smartphone, pocket-sized computing power that has saturated the market. In addition, automakers are rolling cars out with increasingly powerful and user-friendly computing systems installed, allowing API-based integration with the insurance industry.

Lower-friction technology is only part of the battle. Recent S&P research found that only 9% of insurance policyholders were using their UBI mobile app. Insurers also need to sell customers on the value of using UBI technology. For years, raw discounts were the customer-acquisition tool of choice, but that still presented an adverse selection problem: If all the best drivers switched to UBI for the discount, the remaining group would have to see rates rise -- a PR disaster waiting to happen.

The COVID-19 pandemic, however, has changed the calculus on driving for many across the country. Transition to working from home has led people to wonder: "Can I pay less for my car insurance because I’m driving less, and exposing myself to less risk on the roads?" This concept surfaced in reporting over the pandemic fallout era with companies from USAA to Allstate reporting higher take-up of UBI, especially by new customers.

Digital Insurance set out to ask the top auto insurance companies (according to NAIC market share data) to take stock of their current UBI offerings, and find out how that’s translating into an install base. Following is the information we gathered through our outreach. -- Nathan Golia

State Farm

Drive Safe and Save
Year launched: 2009
Total enrolled customers: Declined to say
States available: 47
Technology partners: Cambridge Mobile Telematics
Technology platform: Mobile app, connected-car integration, OBD-II device
What it measures: Miles driven, acceleration, braking, cornering, speeding, and phone distraction.

Geico

DriveEasy
Year launched: 2019
Total enrolled customers: Did not reply to request for comment
Technology platform: Connected car and mobile app
What it measures: distraction-free driving, braking, speeding, and cornering

Progressive

Snapshot
Year launched: 2008
Total enrolled customers: 8 million
States available: 48
Technology partners: Cambridge Mobile Telematics
Technology platform: Connected car, OBD-II device and mobile app
What it measures: “Time of day, sudden changes in speed (hard brakes and rapid accelerations) and the amount driven. For customers who use our mobile app, details about handheld phone use behind the wheel will also be collected.”

Allstate

Drivewise/Milewise
Year launched: Drivewise 2010, Milewise 2016
Total enrolled customers: 2 million
Technology platform: Connected car and mobile app

USAA

SafePilot
Year launched: 2019
States available: 25
Total enrolled customers: Not given, but USAA says about half of new policies sold opt for SafePilot
Technology partners: TrueMotion (now Cambridge Mobile Telematics)
Technology platform: Mobile app, OBD-II device
What it measures: Location, time of day, phone handling, hand-held calling, hands-free calling, harsh braking


Liberty Mutual

RightTrack
Year launched: 2016
Total enrolled customers: Did not reply to a request for comment

Farmers

Signal
Year launched: 2017
States available: 39
Total enrolled customers: Not given
Technology partners: TrueMotion (now Cambridge Mobile Telematics)
Technology platform: Mobile app
What it measures: Focused driving, hard brakes, excessive speed, time of day, and total mileage driven.


Nationwide

SmartRide/SmartMiles
Year launched: 2012/2019
Total enrolled customers: Not given
States available: 49/42
Technology partners: “Nationwide collects data for both its programs via connected car platforms with many major manufacturers as part of a partnership with Verisk. Its mobile app platform is developed in partnership with Cambridge Mobile Telematics. Trak Global and Octo provide plug-in device support”
Technology platform: Mobile app, connected-car integration, OBD-II device
What it measures: “SmartRide is a pay-how-you-drive program that takes into account miles driven, hard braking, fast acceleration, and night-time driving. SmartMiles leverages similar data points, but also provides flexible premiums based on miles driven.”

AmFam

KnowYourDrive

Year launched: 2017
Total enrolled customers: Not given, but AmFam says its household penetration is 10% and about half of new customers opt for KnowYourDrive.
States available: 19
Technology partners: TrueMotion (now Cambridge Mobile Telematics)
Technology platform: Mobile app
What it measures: Trip and event data around speeding, time of day, braking, and distracted driving.


Travelers

Intellidrive
Year launched: 2017
Total enrolled customers: Signups have increased 46% since July 2020.
States available: 39 plus Ontario, Canada
Technology partners: TrueMotion (now Cambridge Mobile Telematics)
Technology platform: Mobile app
What it measures: Braking, acceleration, speed, time of day, and phone use.