Towers Watson, Vodafone launch telematics program, with AIG signed up for pilot

Mobile communications company Vodafone and Towers Watson have launched a telematics program, aimed at speeding up the development of usage based insurance offerings outside of North America.

United Kingdom insurance company AIG Europe Limited, part of the international group AIG, has signed up to run a pilot, the companies confirmed.

The companies are combining Vodafone Vehicle Connect, (its telematics proposition) and Towers Watson’s DriveAbility program, in an effort to accelerate the pace at which insurers can get new services to market at a competitive cost, they said in a statement.

Insurers will be able to choose from a range of data collection devices under the program, according to a statement released by the companies. The majority of offerings are expected to be made available to customers on a self-install basis, including options for insurers to offer “try before you buy” applications on smartphones.

In countries where self-installation is not yet practical, assisted installation will also be available, the companies noted.

User support, including recommendations for improving driving safety, is being offered through existing insurance call centres, smartphones and a dedicated website.

“Launching and maintaining successful telematics motor insurance products involves more than simply sourcing a device and considering basic driving events,” noted Duncan Anderson, global head of pricing and product management at Towers Watson.

“From our experience of doing work for clients in the United States, we know that analysing granular data allows a much deeper understanding of the context of driving behaviours, which gives a much greater understanding of the likelihood of claims.  Indeed we have found that our scores can differentiate loss ratio by over a factor of 10 from the best 10% of business to the worst 10%.”

Consumer interest in telematics programs among European drivers has been accelerated by recent gender-based pricing regulation, the companies also noted.