Experts Predict ‘Smart Insurance’ Boom
According to the latest report of Ptolemus, as of November 2015 there were 4.4 mln usage-based insurance clients compared to only 2.1 mln in July 2013. Many of them hail from Italy, the UK, Spain and France.
In December 2015 only Italian Generali Group held 800k usage-based insurance policies. Italy is on the cutting edge among European countries in terms of adopting telematics technologies. Among other countries where ‘smart insurance’ is being actively promoted are the UK, the U.S. and Canada. Multiple studies in this regard are also being held in China which even changes the legislation to liberalize insurance rates and promote ‘smart insurance’. Just recently Australia and Belgium also joined the list.
Experts from Ptolemus predict that the U.S. can potentially become the global leader in application of smart insurance techs. Lion’s share of European usage-based insurance market growth belongs to Italy. However, the UK, Germany and France are also expected to advance in this field in the next five years. New vast markets will also emerge in China and Russia.
“First telematics products in Russia began appearing in 2010, and it was clear back then that this direction had a great potential”, noted Mikhail Anokhin, Co-founder and Executive Director, “Smart Driving Labs”. “Being at the origins of domestic telematics market I was directly involved in creation of initial options of technology implementation and watched its development from inside. Weaknesses and untapped opportunities of existing solutions made me think in order to create a product that will meet the requirements of Russian consumer to the greatest possible extent we need to stop working with foreign suppliers and create our own telematics solution. Today, by the time of the market release of our product, many things have changed, but it is still clear that the main trend remains same, the technology is being actively developed, engaging more and more new players, new opportunities are opening, including for related markets.”
According to J'son & PartnersConsulting, by 2020 the total value of smart insurance market in Russia will be around 3.3 mln smart policies and penetration level of smart insurance of cars will reach 52%.
By 2020 there will be around 100 mln motor vehicles holding smart insurance all over the world, according to report by Ptolemus, and ten years later this number will increase by 50% ultimately bringing over 250 bln Euros in premium to insurance companies.
By 2020 most US and European car manufacturers will have adopted telematics technologies and emergence of autopilots and modern driving assistance systems will help reduce the number of road accidents by 30-40%.
“Russian telematics market is keeping up with its Western colleagues. A product that we have developed in Smart Driving Labs is the first telematics product that was created in Russia from scratch and is unparalleled anywhere else in the world. In fact, today we are able not only to predict the development of Russian telematics market but we actually set this direction”, Anokhin summed up.
Experts from Ptolemus warn that application of telematics will be a winning strategy for insuring companies promoting strengthening of their positions on the market. And, to the contrary, those insurers who will continue in car insurance business without telematics will suffer huge losses from a large number of careless clients ultimately leading to unbalanced product portfolios.