Consumers are beginning to see the safety benefits associated with telematics as a major proof point when deciding whether or not to adopt a usage-based insurance (UBI) program, while commercial fleet managers are interested primarily in price cuts, according to the 2014 LexisNexis Insurance Telematics Study.
Consumers are beginning to see the safety benefits associated with telematics as a major proof point when deciding whether or not to adopt a usage-based insurance (UBI) program, while commercial fleet managers are interested primarily in price cuts, according to the 2014 LexisNexis Insurance Telematics Study. The data also found that commercial fleet managers are nearly as aware of UBI as consumers, at 25 percent and 38 percent awareness, respectively.
Price and savings are the number one factor in fleet managers’ decision to incorporate UBI into their small commercial fleet. Despite significantly less insurer marketing for UBI in this space, small business awareness of UBI is relatively strong at 25 percent.
The study also explored the effect of value-added services, mainly fleet management capabilities, on a UBI program offering. Contrary to common beliefs, results show that small fleets want UBI, with or without fleet management services. They find the discount and simplicity of UBI appealing.
“Two-thirds of small fleet managers shop for insurance every two years or more,” said Ernie Feirer, vice president and general manager, commercial insurance, LexisNexis. “These fleet managers are looking for ways to save money and our study shows 27 percent of them would sign up for a UBI program. This leaves a lot of room for growth and a huge opportunity for carriers offering UBI.”
Specific findings showcasing how commercial fleet managers are adopting UBI to save money include:
Small fleet managers also value services such as stolen vehicle tracking, fuel consumption/efficiency updates and automatic emergency crash response according to additional findings from the survey. Commercial fleet managers are also receptive to mobile UBI technology and 73 percent of small fleet drivers have smartphones.
“With the uptick in consumer awareness shown in the study findings, we are more dedicated than ever to bringing insight-driven, end-to-end UBI solutions to our customers,” said Ash Hassib, senior vice president and general manager, auto and home insurance, LexisNexis. “With our recent acquisition of the UK-based industry-leading telematics data services company, Wunelli, we now possess one of the largest provider-held insurance telematics databases in the world. This allows us to best support insurers as they assess risk, discount safer drivers and serve their customers more effectively.”