Claim resolution is the biggest consideration that drivers and automobile owners have in mind when choosing an insurance provider. And claims are the single biggest expense for the automotive insurance industry. This is why improving the claims process is of critical value not only to insurance providers but to their customers as well. There is a certain mindset that all young drivers are rash and careless and are a big risk to insurers.
This is where rubber hits the road for Telematics as it makes its effect felt across both the insurance as well as the automotive industries. The onset of Telematics allowed companies to look beyond the traditional approach of trying to improve only the manual aspect of claims processing.
The sweeping technological advances that have been made in Telematics today, has made it possible for auto insurers to craft realistic driving profiles of their customers. With this, people who drive safely and responsibly, can save money on their insurance premiums, quickly and efficiently have claims processed and have wheels on the road soon after an accident.
For the insurer, it offers the possibility being alerted immediately when there is an accident. This means that emergency services can be dispatched immediately to the scene of the accident especially where the accident is of a serious nature. In addition to immediate medical assistance to the driver, repairs to the vehicle can begin in quick time and the claims process can be initiated almost immediately. The rapid response, real-time assistance and quick claims service provided by the insurance company is not only much appreciated by the customer but it also helps the insurance provider to avoid the possibility of costly fraudulent claims arising out of an accident.
The Telematics device that makes all of this possible consists of a small databox that is fitted into the car by the insurance company. Once installed and set up, Telematics can track and record the driving behaviour of the car driver – the smoothness of gear changes, acceleration and braking, the mileage covered, the type of roads driven on, the time of the day that the vehicle is driven and the drivers observance of speed limits. The data collected also records the exact location of the vehicle at any given point of time and this is useful to deter car thieves. Based on the data collected and analysed about an individual drivers behaviour, the insurers can offer accurately priced premiums.
The data collected by the databox includes:
(Graphical representation of the points below)
- Distance the car travels
- Period of time the car is used
- Location of car all times (this is also a security benefit)
- Type roads is the driver travelling on
- Speed and direction travel prior to and after a collision/accident
- Drivers acceleration and speed
- Use of car lights and turn indicators
- Drivers braking behaviour
- Force of impact in an accident/collision
- Reporting data if an accident occurs
3 ways by which Telematics is revolutionising claims
The auto claims process has always been long and strenuous. It is time consuming for both insurers as well as consumers. From the time an accident occurs, the insured is under a great deal of stress – the emotional strain resulting from the crash, the police documentation, hospitalisation if necessary, and repairs to the vehicle. It usually takes between one to three days after filing a claim for the insurance adjuster’s report to be sent in and longer if the vehicle needs to be inspected. Getting wheels on the road again is an average of 4 to 7 days depending on the extent of damage.
The advent of Telematics is now revolutionising the system by validating claims, speeding up the claims process and placing safety and convenience as a priority for the insured.
Validation of claims with Telematics
Filing claims has historically been a manual process where a driver involved in an accident needs to file his claim documentation with the insurance company, after which a claims adjuster reviews the claim and files his report – sometimes after taking additional time to inspect the vehicle/s involved in the accident. Then, the insurer scrutinises the documentation and could call for clarifications before agreeing to pay for the claim, partly or can deny the claim. At times, even courts need to step in to resolve claims and disputes. Telematics can help drivers mitigate this convoluted and tiresome process by providing accurate, unbiased crash storylines. The data that telematics provides details key findings such as the severity of a crash, where the vehicle was hit, the driver’s speed (before, during and after a collision), the weather/road conditions and much more. All of this factual data reduces ambiguities and disputes and gives the claims adjuster and the insurer data that has a significantly higher degree of accuracy.
Accelerating the claims process
Not only does telematics enable insurers to settle claims seamlessly and accurately, they help to prevent fraudulent claims as all the vital information about a vehicle is constantly tracked and recorded. Because telematics alerts the insurer as soon as an accident occurs, they are alerted to the possibility of an upcoming claim and the claims management system comes into play. The system can alert the police authorities and emergency services, arrange to tow the vehicle (if needed) and alert the nearest authorised repair shop to get the vehicle repaired and roadworthy at the earliest. This results in simple and straightforward fact-based documentation and a much faster claims resolution.
Placing safety at the forefront
Many auto insurers are using telematics to assess risks and to encourage safer driving behaviour. While this also does, over time, bring down claims ratios, telematics has another very tangible and major benefit to give – the possibility of saving lives in case of an accident. This technology has the ability to detect crashes within moments of them occurring and then to send real-time notifications to emergency services, first responders and roadside assistance. By providing crucial information like GPS location and driver medical history to first responders, telematics systems ensure that not a single minute is lost in the effort to preserve life in an emergency situation. The financial implications of this for insurers, is the reduction in claims arising from serious disability and probably even the loss of life of the driver.
The often forgotten human element
An insurance program that measures aspects of driving and rewards drivers for safe driving, is increasingly seen to attract customers who are far less risky drivers. This immediately translates into more profitable customers for the insurer. A consulting firm that has conducted extensive research on this issue found that it can lead to an average decrease in total claims of up to 57 percent. On the flip side, drivers who are more likely to run a red light, over speed or drive rashly, will move to more traditional insurers who have non-usage based insurance policies – as such policies will work out to be less expensive for them. This move will further reduce the outflow on claims for insurers who base their premiums on the use of telematics.
With the implementation of cutting edge innovation that is possible through telematics, Neutrinos sees it emerging as the single most effective driving force in improving the bottom line for insurers and rewarding safe drivers while at the same time irrevocably and positively revolutionizing both the claims process as well as the claims experience.