Trends Touching the Auto Insurance Buyer

By Spalding Scattergood

The insurance industry is one of the sectors that've been way influenced by the world financial crisis. Shockingly, penetration levels are still very low, and because of the large unused market, insurance companies are busy coming up with new products. Nevertheless with the discussed predicaments, the insurance industry has naturally generated new business trends. Advances in data collection systems are presenting benefits to consumers and new sets of challenges to insurance corporations. Typically auto insurance information was being obtained from sources starting from state to county level info repositories. Today, this same data is now being picked up right from car courtesy of technical advancements such as telematics. This information can hence be applied by insurance players to derive valuable business revelations. These gigantic info have transpired as good tools because insurance firms can utilize the information received to form part of their competitive advantage because this very info is also providing the industry with a deep understanding on client specific needs. These are some of the trends shaping the insurance industry.

The Big Boys. The vehicle insurance industry has been completely flat over the past decade because it's just the top 10% players who continue to dominate the market. This dominance can be attributed to assertive product pricing coupled with increased spending on adverts. The above described situation has left other small players totally out of the business whereby these smaller market participators have been able to post business growth only through company express retention programs and premium buyer services. Players who actively employ the already mentioned large information definitely find new expansion possibilities.

Telematics. Car insurance players have today managed to introduce something known as "usage based insurance (UBI)" where the insurance industry monitors a driver's habits to package for him/her future policies. As an undeniable fact, insurance players have been compelled to stop procrastinating on developing UBI solutions, because research from credible sources is already showing that buyer demand is positioned to increase following wide adoption of UBI idea. Additionally, there shall also be wide adoption of policies thanks to UBI which implies that corresponding ad budgets will be easily converted into leads.

Google self driven cars. With this idea car even a blind person can sit on the driving seat and travel to whichever destination they need. It is being forecast that these self driven autos are going to be publicly available in less than 5 years time, and one key selling point with these automobiles is that they are set to retail bellow $100K which is within reach of the majority of households living in developed economies. The Google cars are also set to feature extraordinary safety ratings. This clearly signals that there shall be multi-faceted implications for the insurance industry re underwriting.

With the above info it is beyond reasonable knowledge that with an all-embracing digistrategy form insurance players, big info coupled with business intelligence will at last influence the general insurance industry therefore dictate auto policy provisiongt; New information sources will also bring in unprecedented info relating to a drivers behaviour therefore tagging his/her profile when seeking a vehicle policy.

About the Author:

Spalding Scattergood, the writer, thanks Allstate agent Chris Pike, Richfield and Garfield Heights, for his insights on auto insurance trends.