Majority of U.S. drivers open to UBI programs, especially if premiums guaranteed not to increase

Drivers in the United States are open to the idea of buying usage-based auto insurance, especially if they could be guaranteed their premiums wouldn’t increase, according to a new poll from Towers Watson.

 Of the U.S. drivers included in the global survey, 79% said they would either buy a UBI policy.

If they could be guaranteed their premiums wouldn’t rise, 89% said they’d be willing to sign on. 

Interest was highest among drivers between 18 and 34, with about 66% in that group saying they would “definitely” or “probably” purchase a UBI policy.

Just over half (54%) of the participants who drive every day showed a strong interest in UBI, Towers Watson also noted.

“Many major auto insurers already offer UBI policies, though consumer adoption has been slower,” said Robin Harbage, global lead for Towers Watson’s UBI practice and DriveAbility service offering.

“Consumers are now becoming more familiar with UBI, and they like what they see. They are beginning to realize their data can actually be helpful while lowering their monthly premiums. Drivers’ views on UBI are rapidly evolving — they are embracing the technology and making it part of their driving experience.”

Overall, drivers showed the more interest in vehicle theft tracking (83%), automated emergency response (82%) and vehicle wellness reports (79%).

The majority (60%) of those interested in UBI programs also said they would be willing to change their driving behavior. This was highest among younger drivers (76%), who represent the largest risk segment, according to Towers Watson.

When asked how they might change their driving behavior if a UBI device were to be installed in their car, respondents listed sticking to the speed limit (71%), keeping a safer distance from other vehicles (52%) and driving more considerately (49%) as the leading adjustments.

In terms of concerns, nearly half (49%) are worried their premiums would increase with a UBI program. Other concerns related to privacy, such as insurers sharing consumer data (41%), fears that insurers will monitor and track driving destinations (42%), and apprehensions about insurers using data to invalidate claims (38%).

“These are understandable but not material enough to prevent further UBI adoption. In fact, these concerns actually create possibilities for insurers to design better UBI products,”Harbage added.

The U.S. results are based on a global survey conducted between December 2012 and February 2013, which polled 7,645 respondents, including over 1,000 participants each from France, Germany, Italy, the Netherlands, Spain, the United Kingdom and the U.S.