40% of consumers saying no to UBI program, Progressive CEO says: report

Major U.S. auto insurer Progressive Corp. is still seeking to get more consumers on board with its usage-based insurance program, Bloomberg reported Thursday.

About 40% of potential users of the insurer’s Snapshot program are saying “no way” to the offering, said Progressive CEO Glenn Renwick, the news agency reported.

The rest are evenly divided between consumers who are willing to try it or looking to find out more.

“Our Snapshot advertising campaign, which is set outside of the Superstore construct, ran most of the second quarter,” Renwick noted in a letter to shareholders on the company’s financial results.

“The intent was to raise awareness that an individual’s rates set without the benefit of their specific driving profile, the option Snapshot provides, may well mean they are contributing a subsidy to those with poorer driving behaviors,” he said.

“To date, the campaign has been very acceptable, but short of breakout. The base of Snapshot policies and associated premium continues to grow and now total 1.2 million and $1.8 billion, respectively.”

The program is still a leader in the United States, and licensing issues there are still affecting how other insurers can launch their own UBI and telematics programs.

As of last December, Progressive owned six UBI patents in the U.S., with its application of UBI accounting for more than $1 billion in premiums, according to a recent report from Strategy Meets Action.

Still, SMA has predicted that this year will see a “rapid expansion” for telematics in North America, with 70% of auto insurers are in some stage of executing, developing or planning UBI programs.

Earlier this year, Desjardins General launched its UBI program, dubbed Ajusto, in Ontario and Quebec.

Privacy issues and regulatory approval have been challenges in getting similar programs off the ground, particularly in Ontario, although the province’s financial services regulator has said it’s interested in speaking with insurers about their UBI plans.