Desjardins launches usage-based insurance program in Ontario, Quebec

Desjardins General Insurance Group has launched a new usage-based auto insurance offering, the first program of its kind to be approved by the regulator and made widely available to drivers in Ontario.

Dubbed Ajusto, the new UBI program will also be available in Quebec. The program is free and voluntary for current and new Desjardins policyholders, who the company said can save up to 25% on their insurance premiums.

Using telematics technology from Montreal-based iMetrik Solutions, the program is available to drivers with vehicles made in 1998 or later, with limited exceptions, Desjardins said.

The telematics tool from iMetrik, a wireless device that plugs into a vehicle’s diagnostic port, measures distance travelled and extent and frequency of hard braking and acceleration, with each measurement potentially contributing to a 10% decrease in a policyholder’s premium.

The tool also measures time of day when the vehicle is driven, contributing to a potential 5% rate decrease, the company said.

Related: FSCO lays out how insurers should take on usage based insurance programs

Drivers can keep the telematics tool as long as they wish and can view their driving behaviour and probable premium savings online. The driving data is updated daily and includes a graphic of potential savings, which is only accessibly by the customer, Desjardins said.

Potential savings on insurance premiums are available to customers on annual renewal of their policies. Premiums won’t increase for customers as a result of the program, and can opt out at any time without penalty, according to the company.

Before launching the program, the insurer ran a four-month pilot program with about 200 of its own employees, beginning last December. “Each one of them really realized that just by looking at the way they drove they were able to make adaptations to the way that they drive,” noted Sylvie Paquette, Desjardins’ president and COO.

Scoop for our community: Ajusto is a free program that uses innovative technology to help save on car insurance 🙂 bit.ly/17aocot

— Ajusto Program (@AjustoProgram) May 10, 2013

The company’s studies showed that employees who participated in a pilot program were on track to achieve an average additional savings of 12%, according to a statement from the insurer.  

Based on the success of similar UBI programs in south of the border, Paquette said she expects 25% to 50% of new customers to sign up for the Ajusto offering. The company’s salesforce is already talking to customers about the program and is seeing a good uptake, she said.

Feature article: Driving on Display

Desjardins also offers a similar program, Intelauto, to clients of its group insurance segment, The Personal Insurance Company. Both that program and Ajusto are currently the only widely available UBI offerings to be approved by the Financial Services Commission of Ontario (FSCO), the province’s insurance regulator, according to Desjardins.

Paquette estimates that the entire review process, which included meetings with high-level executives at FSCO took about six months. The regulator was very open to discussing the program with Desjardins, Paquette noted.

Among the important issues when gaining approval was privacy, she said. Customers are often concerned about how their personal data will be used, so the program includes a privacy policy that ensures the data collected through Ajusto won’t be used for commercial purposes or for anything other than calculating a discount, she added.

Desjardins’ next step will be to launch the UBI program in Alberta, then the Atlantic provinces, Paquette said. Each province’s regulators have different requirements and processes, which is why the insurer didn’t go through the review process in all provinces at the same time, she added.