UBI utilizes real-time information when a driver is behind the wheel to collect and send data to the insurance company. With its telematics system, the UBI device detects dangerous driving habits that might make the individual a greater risk to insure. The device has given hope to insurers but has also been a source of frustration. Some insurance companies are still afraid to embrace the technology and wonder what it will do to their business.
Insurance providers are still trying to identify and build strong foundations for their businesses. They face the challenge of finding the most suitable devices with the best overall value for themselves and their customers. Since technology is constantly changing in every area from connected cars to telematics, insurers also have to think about how they can adjust their strategies accordingly in the future.
In 2015, UBI made up 10 percent of Italy's insurance market. The United Kingdom has a very mature UBI market as well. This new type of insurance is also a leading trend in France, German and Spain. However, the United States is slated to become the leading country in the near future because of its strong market potential. In 2015, there were about 5 million UBI users in the United States.
The growing millennial market was a major topic in the report. Experts said that millennials will likely create a higher demand for pay-per-ride and pay-per-mile insurance. An example of pay-per-mile coverage would be a product for a service such as ride-sharing. The driver would be insured for each individual trip for a specific distance. If the driver used UBI and saw that certain time frames came with lower premiums, the driver could choose to accept ride orders during that time period to save money. Insurers must also address autonomous cars and ADAS in the near future.
Experts said that mobile phones will ultimately rule the UBI market. However, that may only last for a short time. As time passes, connected cars will become more common. There will be little need for mobile technology in vehicles then. Experts said that those changes will again cause a shift in how UBI is implemented and measured. To learn more about this topic, discuss concerns with an agent at Halo Insurance & Benefits Group at 314-351-HALO (4256) today.