Over the past 18 months, U.S. auto insurers have expressed renewed interest in usage-based insurance as consumers become more comfortable with the concept. Some U.S. insurers are seeing growing uptake for their telematics insurance programs. Over 30% of new customers are now opting for usage-based insurance at Nationwide and Progressive, for instance. The maturation of smartphones as telematics sensors is also playing a considerable role in shaping insurers’ renewed interest.
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As usual, last week’s Finovate event offered a great mix of innovation across many areas of financial services. Anyone who has attended knows it is an amazing fire hose of content and smart people. Having attended almost every year since the first conference (this year’s event was the 10-year anniversary) it is great to see how the event has expanded in both geography and attendance.
There were a few themes that really stood out throughout the presentations and side discussions:
There is no shortage of speculation about how personal auto insurance may become obsolete in a driverless era, how auto manufacturers’ product liability may compete with personal auto insurance, and how ridesharing may replace personal car ownership and vaporize the need for personal auto insurance. Those topics make good cocktail conversations, but they have little practicality for insurers for the time being.