The percentage of consumers who said they are “uncomfortable” sharing personal information has increased since 2010, from 25 to 35 percent, according to “2013 LexisNexis Insurance Telematics Survey,” from LexisNexis Risk Solutions. Those results are consistent with those of prior separate surveys from Progressive Corp., which have found serious objections from as many as 40 percent of consumers .
LexisNexis also found that consumer awareness of insurance telematics, also known as usage-based insurance (UBI), is on the rise, having more than tripled over the past three years to 36 percent from 10 percent in 2010. Consumers are most aware of Progressive (78 percent), followed by Allstate (8 percent) and State Farm (6 percent).
According to the report:
- 35 percent of consumers are uncomfortable sharing information leading to an accident to determine fault, compared to 25 percent in 2010
- 40 percent are uncomfortable with GPS in smartphones providing location information (N/A for 2010)
- 48 percent uncomfortable with UBI programs that would share driving data, compared with 46 percent in 2010
- 51 percent are uncomfortable with internet/online banking that tracks account information, compared to 45 percent in 2010
- 57 percent are uncomfortable with search engines that capture search data, compared to 51 percent in 2010
- 63 percent uncomfortable with social network sites that maintain personal information, compared to 55 percent in 2010
However, LexisNexis said there is “increased consumer acceptability for UBI” because the number of those who said UBI is difficult to use has declined to 35 percent from 42 percent in 2010, as did those who said UBI gives away too much information, which declined to 70 percent from 77 percent in 2010.
In addition, 61 percent said they are more likely to accept telematics if offered a three-month trial; 72 percent said they would be more likely to accept if offered an automatic discount of 10 percent for the first six months; and one-in-three consumers finds the idea of UBI appealing and is likely to use a personal smartphone to collect and transmit telematics data, LexisNexis said.
Discounts are primary appeal for enrolling in usage-based insurance programs, LexisNexis said, and 50 percent of consumers are likely to sign up for a 10 percent discount, and 36 percent said they would change carriers for a 10 percent discount.
“While UBI continues to become more mainstream, many consumers also find the use of their smartphone in UBI appealing,” said Ash Hassib, SVP and general manager, Auto Insurance, LexisNexis. “For insurers, this creates an opportunity to offer programs that fit consumers’ lifestyles such as smartphone use, value-added services based on their interests and capture important information to gauge future driver risk.”
The LexisNexis survey was conducted by Lynx Research Consulting, an independent research firm, and measured policyholder receptivity to allowing insurance companies to use data collected from telematics devices in their vehicles to help determine rates. The survey polled 2,072 U.S. residents representing insured drivers, ranging from ages 21 to 74.
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