Dinosaurs in a digital world – unlock the digital potential

I was reviewing my insurance bill that my provider still mails to me (even though I do most transactions online) and I noticed that one of the four cars I insure seemed a little high comparably to the others. I emailed the agent questioning why – which he quickly replied that it’s because my 20-year-old son is the primary driver. I picked up the phone and gave him an old-school call to discuss his explanation. After I asked him to explain the criteria he used to determine rate he asked me the following questions:

  • Has your son ever had a ticket? No.
  • Has he ever been in an accident? No.
  • How far does he commute? 6 miles.
  • Does he drive at night or day? Varies, but usually day at different hours.
  • Is he employed? Yes, part time. He is a full-time student.
  • What is school grade point average? Um! What? Why?
  • Well, if he is a good student with good grades they view that as a positive toward his driving and might receive a minor reduction in the rate. If you provide me a copy of his grades I’ll get it into motion.


Our conversation really made me think about how many people are not receiving accurate rates because of the lack of insurance provider’s ability to truly monitor how they drive. This aged old method of determining a driver’s insurance rate based on a few indicators is unrealistic and should be obsolete in today’s world of connectivity and the growth of the connected vehicle. But as in my case, it still exists. Yet, there are over 100 million lines of code and nearly 100 electronic control units in the connected vehicle that generates unlimited amounts of vehicle data. OEMs are sitting on a “gold mine of data” – and this will continue as more and more vehicles become connected. In fact, in just a few years, nearly every vehicle on the road will have embedded connectivity.


“By 2024, 89% of new cars worldwide will have embedded connectivity.”

Analysys Mason
Connected cars: worldwide trnds, forecasts and strategies 2014-2024
June 9th, 2014


With this data, OEMs and partners become more knowledgeable about the vehicle operations, opening new opportunities to provide value added services to customers. Usage-based insurance (UBI) is a term used to develop insurance cost based on the type of vehicle used, measured against time, distance, behavior and place. Basically, you pay based on your driving behavior. Connected vehicle technology, along with telematics and analytics enable insurers to provide more customized packages for consumers.

However, with many potential entities involved in providing the service, OEMs will be challenged to deliver an optimal solution. Several sizable obstacles to realizing a competitive, sustainable and fully integrated UBI solution includes customer adoption, customer privacy, technology cost for some entities, ecosystem complexity and meeting regulatory and certification requirements.

Automakers must be able to provide data in a secure and standardized way to be able to share with multiple partners. Being able to provide this with speed and accuracy, and with appropriate interpretations and analysis can be complex and costly to most OEMs. The ability to manage the potential volume of and interpretations of data, and to address fragmented telematics ecosystems are additional concerns to address. To be successful in enabling UBI, automakers must be able to standardize data, connectivity and platforms while allowing for scalability and speed to change. And, doing all this while managing regulatory and compliance concerns, protecting the consumer identity and securing the vehicle data.

Covisint can help enable UBI through the most complete IoT platform for the connected vehicle. Our platform helps manage digital ecosystems, provides fine-grained access and control, and assures trusted interactions with all entities. We allow OEMs to become the data hub that aggregates and shares data with the highest level of authorization control and guaranteed security. OEMs can provide insurance agencies the ability to securely mutualize driver and vehicle data, and access the data slices relevant to their customers for personalized service offerings. A far more intelligent way to determine insurance rates for consumers.

And getting back to my story. Once I shared with my agent the type of data I receive from my personal vehicle via my owner center application, he was quick to reply that he needs to better explore UBI services.

Don’t be a dinosaur in a digital world.

Learn more on unlocking this potential by clicking on this link.


The post Dinosaurs in a digital world – unlock the digital potential appeared first on Covisint.