Report 1 – confusion reigns over US regulatory structure – whole industry has much to learn – ‘don’t get panicked with your widgets’
Telematics.com founder, Rob Prime, attending the first half-day session of the international telematics insurance conference which opened this morning in Chicago says the first impression gained is that the US telematics field is not as organised and advanced as he first thought.
‘There is some confusion over regulation,’ he reports, ‘with each of the 50 or so states setting their own regulatory framework. Some states set out clearly what information from driver recording devices can be held, for what purposes it can be used and for how long it can be retained. Other states have different ideas.’
This means the insurance providers are having to tailor products on a state by state basis: ‘It gives one the feeling of confusion, lack of overall clarity,’ he says.
For example, among the larger insurers, Progressive, insurance is more about pure usage not so much how you drive, while All State – which claims to service the whole country has to offer a product that works uniformly in all states and is much more about how you drive and not just how often. ‘These are the two main strands and all new companies entering the field follow one or the other of these determining initiatives.’
So, no uniform direction on the type of product and device – some devices and policies are based on how often the driver uses the vehicle, others are more sophisticated, and record and calculate driver styles (speed, distance, acceleration and so on) and the driver’s response to road conditions and traffic regulations.
New legislation is promised in the next five years – that should help straighten out which direction the companies will follow.
‘Overall’, says Rob, ‘One gets the clear feeling this is very early days for telematics and there is a very big job to be done in simply explaining to drivers, particularly young drivers, exactly what is on offer and how it works.
Data shortage – data redundancy
‘One noticeable thing for me occurred during a panel discussion – in answering a question on how you should conduct usage based insurance – how it should be set up – the contributor revealed that he was in the middle of running a pilot himself – that is, giving advice on a product which he himself had not completely evaluated.
‘It is my view that there is not enough data yet on which measurement tools are useful and which are redundant.
‘This is a big problem – how do you explain to a customer a product which you don’t fully understand yourself – how do you get the message across to the customer when the basics are changing so quickly?’
There is much interest in what is happening in Europe, particularly in Italy and the UK, with a session devoted to this in the second half-day. So, we have America looking to Europe rather then the other way round.
‘There’s a debate hear over technology’, he noticed, ‘smart phone mobile apps versus vehicle mounted devices – the issues are quite sharply focused.
‘Delegates were warned not to get panicked by the sheer range of devices available – over 300 of them, so many that the consumer risks being paralysed by choice.
‘Apps seems to be favoured more by the young driver’, he noticed, ‘From here is hard to see a future for the black box with this type of driver – it might get left behind. And this might happen quite quickly – at least that’s the impression I’m getting here’.
Rob Prime at the conference – Jonathan Coe reporting.
See previous blog video for a view of why Telematics.com is attending the conference.
Another report here on the second half of the first day shortly – exclusively on Telematics.com.