In the auto insurance sector, the connected car is bringing disruption and opportunity. Many insurers already use car telematics to personalize risk assessment and pricing, or even to offer usage-based products. Some are using it to offer a range of value-added services such as roadside assistance and traffic alerts, vehicle security and driver coaching. Other insurers are starting to forge new partnerships and build ecosystems that will allow them to remain relevant in a world where personal auto ownership will be rarer and where the nature of the risks they manage will be vastly different.
BMW and Allianz, for example, have agreed to offer usage-based insurance underwritten by Allianz for the car manufacturer’s i3 and i8 electric vehicles in the United Kingdom. And State Farm, the US’s largest personal lines auto insurer, is collaborating with Ford on autonomous driving research to assess whether driver-assist technologies can lower the rate of rear collisions.