The auto insurance industry is poised to be turned on its head by telematics-powered usage-based insurance (UBI), and agents and brokers are taking notice. I chatted with Basil Enan, CEO of online agency CoverHound, recently about the subject. His agency offers UBI products from Progressive and The Hartford, but he believes that his company can take an even more hands-on role in encouraging adoption of the product.
"A lot of our carriers are asking us in how we could play a role in getting devices into our policyholders hands," Enan says. "We're even looking at making them available through CoverHound."
Enan says that a more horizontal, potentially agent-distributed device strategy could help make driving data more portable, assuring customers that they could take that information from one carrier to another that might offer a deeper discount, in the same way they can use their more conventional data to do so now.
"From our position in the market, a carrier-agnostic device so our customers aren't locked into one product would be ideal. If I've been driving with Snapshot for 'X' number of years, I don't want to start all over again with The Hartford," he says.
Customers are asking CoverHound about the product, Enan says, so there's definitely potential in the marketplace. If using the agent channel as the vector for device distribution and data collection helps improve speed to market at the expense of a little propriety, the industry as a whole could benefit.
"A lot of carriers think they have a few years to figure this out, but I don't know whether that is true. The more aggressive growth rates put the market at about 3%-4% by end of 2014. Customers are going to be demanding this, and we as the intermediary are in the conversation with our carriers to make sure they react a little more quickly than they normally could," Enan says.
Nathan Golia is senior editor of Insurance & Technology. He joined the publication in 2010 as associate editor and covers all aspects of the nexus between insurance and information technology, including mobility, distribution, core systems, customer interaction, and risk ... View Full Bio