Mobile telematics data can offer rich insights into distracted driving and impact loss trends, Insurance Analytics Canada speaker suggests

Mobile telematics data, while sometimes providing “noisy,” or meaningless information, can also offer rich insights on distracted driving that could impact loss trends, a speaker suggested on Wednesday at the third annual Insurance Analytics Canada Summit in Toronto.

Ted Gramer, chief executive officer at Boston, Mass.-based TrueMotion, a mobile telematics data science company, said that mobile apps like Mojo from his company are starting to provide “really rich information” around distracted driving and how people are using their devices.

“With the phone data, we are able to not only at a high level look at distraction, but we can take distraction really at microseconds and tell the difference between the time you are texting, the time you are on Bluetooth, the time you are just using the phone with your hands, activity, typing, swiping, locked, not unlocked,” Gramer said. “That level of granularity is what is driving the trend. So we can actually build loss trends from really a granular level and rebuild the impact on frequency. Once you know what the loss trends are starting to look like, the next chapter is trying to figure out how do you take the rate and adjust your premiums to reflect that.”

Digging deeper into phone technology and analytics – sensors, GPS data and usage data – can “almost get down to risk per trip,” Gramer suggested during his presentation, titled How Mobile Apps are Unlocking the Next Generation of Insurance Products and Services. For example, the data could help fill in the gaps between accidents with similar physical damage, but different g-force impact on a vehicle, he said. “The opportunity to dig in and connect the dots with mobile data is far more than I ever appreciated. The challenge is it’s not easily accessible. It’s taking really noisy data.”

Still, even with “very basic behavioural science and personalization,” Gramer says he is seeing results. “The key leverage point in behaviour modification is it happens right after you put the app on the phone,” he told conference attendees. “If you want to impact loss trends, you can do it accident month one by getting this kind of behaviour modification onto the phone.”

And once that mobile data is available, “you can start mapping it back to your rate indications, so you don’t need to start applying peanut butter rates across the board,” he said. “You can start to get a lot more targeted: which segments and which types of people are driving your loss cost.”

Telematics also offers a “really significant opportunity in claims,” Gramer said, noting that rich data from the accident scene can describe such things as if the vehicle’s airbags deployed, how quick deceleration happened, if a person got out of the car after the accident and started walking or placed a phone call, to name a few examples.

“There’s such rich context that if you are a claims adjuster… this type of information is extremely valuable,” Gramer argued. Combining data with other “context data” could further produce beneficial results for insurers. “You could have a customer that right after an accident just swipes in the trip in your app and all this data goes right to the insurance company and provides the basis,” Gramer suggested. “And you could really almost write a payment for small claims based on that type of experience. That’s not what the industry is doing today.”

The challenge for the industry, he said, is to “figure out how to make the value proposition compelling enough that consumers want your app on their phone, and the insurance industry hasn’t done a great job of that. Part of the challenge for all of us is to develop the products that actually really improve the customer experience and take the waste out of the system.”

To develop these products, sometimes the industry needs to go back to the technology itself. “Our view is that this is a problem that was created by technology and we will use the same technology to fix it,” Gramer said. “With the same science that created the problem, we are going to put a big dent in moving the other way.”