New Insurance Pattern for Vehicles Based on Usage

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For those who own a car need not be told, how annoying the car insurance policies can be. Even though till now people had no other choice but to play along with whatever rules were set by the insurance companies, today the scenario is changing in the favor of the consumers for the first time in the history of automotive industry. Yes, the credit will surely go to the Internet of Things (IoT) that has changed the way of doing things simply by making information accessible to all.

According to the experts working at the Chevrolet dealer Jasper, the wave of connectivity has influenced the majority of industries around the world, and hence insurance alone couldn’t afford to lag behind. With this new globalization, insurance industry as one of the major contributors to the world financial matters, is experiencing a sea change that is solely driven by the IoT and Fintech.

The Influence of IoT

The platform of IoT has a lot of contribution in connecting the various sectors of insurers including automotive, property, individual policyholder and blockchain. As the usage of IoT data is helping the Insurance companies to improve their business operations by making each of their work procedure like estimating necessary reserve pricing policies, and assessing risk, precise, the industry had to maximize the usage of IoT to a significant level, that in turn has benefitted the consumers of insurance policies, especially in the automotive sector. Opportunities are growing in a sustained manner and the first instance of it is the usage based insurance (UBI) of cars.

Defining Usage Based Insurance

The usage based insurance (UBI) in the Automotive industry can be best described as a category of motor insurance that is now taking various factors into their consideration while doing the calculation of the premiums to be paid by each insuring candidate. These factors till is known to be including things like,  type of vehicle used, the maximum distance traveled, and even the behavior of the drivers with the passengers along with their driving habits. UBI or Usage Based Insurance is implemented to encourage the practice of safe driving to minimize the reasons and scopes that lead to accidents. With the implementation of the Usage Based Insurance, the automotive insurance companies are too benefitted in turn as it helps them to reduce the claims payout and strengthen their bottom line.

Types of Usage Based Insurance:

To know more about the Usage Based Insurance, we first need to know the types of it, that we have listed below:

  • Insurance based on distance
  • Pay as and when you drive
  • Pay how the way you drive
  • Manage how the way you drive

Artificial Intelligence in Transportation

As explained by the team of experts serving the Chevrolet Jasper, the concept of UBI indicates that it is focused mainly on benefitting the customers and to establish this fact it has offered premium discounts to the customers based policies especially on certain driving parameters and driving practices with the help of smart and Artificial Intelligence technologies like advanced collision alert. All this has helped the insurance companies to improve their products making them highly customizable for the customers.