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Millennials are most enthusiastic about buying usage-based insurance and believe it’s a better way to calculate premiums, according to research from Towers Watson. Here's why:
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Young drivers prefer UBI (72%) to traditional premium calculation factorslike age, gender and credit score, compared to 51% of other age groups surveyed.
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Millenials are also more willing to participate in UBI by downloading a newsmartphone app (92% versus 81% of members of other age groups willing to try UBI) or through an existing app (88% versus 81%).
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Millennials are also more willing to pay for value- added services enabled by UBI technology, such as automated emergency response. Ninety percent of those surveyed said they would pay at least $45 per year for these benefits, compared to 65% of other age groups.
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Millenials are also more willing to change their driving behavior based on UBI data: 84% would change their behavior, compared to 53% of all others.
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However, a quarter of all respondents said they were unaware of UBI programs overall. So the insurance industry has an opportunity in education, Towers Watson concludes.
Telematics