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PTOLEMUS Consulting Group Introducing insurance telematics Insurance Telematics Europe Conference London - 7 th May 2013 - PTOLEMUS intellectual property
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Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

Jul 25, 2020

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Page 1: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS Consulting Group

Introducing insurance telematics

Insurance Telematics Europe Conference

London - 7th May 2013 - PTOLEMUS intellectual property

Page 2: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

PTOLEMUS in a nutshell

PTOLEMUS is the first strategy consulting firm focused on telematics and geolocation

2

Mobile content and social networking Application stores, crowd-sourcing, etc.

Navigation & location-based servicesMaps, traffic, fuel prices, speed cameras, parking, etc.

Usage-based charging PAYD / PHYD insurance, Road User Charging,

PAYD car leasing & rental

Telematics & Intelligent Transport SystemsConnected car, tracking, fleet management, eCall, bCall,

Stolen Vehicle Recovery, Car As A Service, connected train, etc.

Positioning / Location enablement

M2M & connectivity

Our fields of expertise

Strategy definition

New market entry, business plan development,

board coaching and support

Evaluation of investmentStrategic due

diligence, market

assessment, feasibility studies

Innovation management

Product & services development,

roadmap definition, project

management & launch, patent

strategy

Business development

Partnership strategies,

response to RFPs, lobbying

Our consulting services

Procurement strategy

Specification of requirements,

launch of tenders, supplier negotiation

& selection

Implementation

Project & programme

management, risk analysis &

mitigation strategy

Page 3: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

PTOLEMUS in a nutshell

Who we have helped

3

Consumer electronics makers

Content & application providers

ITS operators & regulatorsPositioning solution providers

Telecom operators

Telecom infrastructure providers

• Partners in Brussels, Paris, Hamburg, Milan and the UK

• +50 years of experience in mobile• +100 years of experience in telematics

PTOLEMUSConsulting Group

Insurers & assistance providers

OEMs & telematics vendors

Montezemolo & Partners

Financiers

Page 4: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS 3

PTOLEMUS in a nutshell

We recently published the Insurance Telematics study, the most comprehensive report written on the subject

• 410 pages of analysis on the PAYD / PHYD market based on

- 83 interviews in 18 countries

- 230 figures (charts, tables...)

- 2 years of research

- Our experience & vision of the ecosystem incl. OEMs and TSPs

• Case studies & learnings from ALD Automotive, Amaguiz, Coverbox, Discovery Insure, GM OnStar, Hollard Insurance, Insurethebox, Liberty Mutual, MAIF-MACIF, Norwich Union, Octo Telematics, Progressive, Solly Azar, State Farm, Unipol, Uniqa, Zurich

• A handbook of suppliers' solutions including our own evaluation & ranking

• 10-year market forecasts - Country's readyness to telematics

- Forecasts for the US, Italy, the UK, France, Germany and Russia

• Insurer's telematics market model results in 4 markets*

• A complete set of recommendations to underwriters, TSPs, OEMs, MNOs and governments

• A strategic analysis of the value chain evolution including - The impact of eCall- The impact of the smartphone- The effects of the gender ruling

More than a research study, a real strategic market

analysis

Note: A free 60-page abstract can be downloaded from www.ptolemus.com/insurance

Page 5: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

Source: PTOLEMUS

What is insurance telematics?

• Most underwriters currently use static / statistical criteria to evaluate drivers' risks - Age, gender, vehicle make & age, place, business category, occupation, etc

• The historical claims profile is also taken in account

• Insurance telematics is a policy based on these criteria and 4 new dynamic parameters

Its basic principles

Introducing insurance telematics

The driving risk star

Distance

Static criteria

(statistical) Time

Place

Driving behaviour

Historical claims profile

Page 6: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

INSURANCE TELEMATICS

U B I

Introducing insurance telematics

Source: PTOLEMUS

Let us share all the same definitions

6

No telematics Telematics

Current motor insurance

Behaviour

No behaviour

PHYD

PAYDPAY-PER-MILE (Self-reporting- based policies)

STOLEN VEHICLE

RECOVERY

SAFETY SERVICES

(eCall / bCall)

CRASH FORENSICS

Page 7: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

Source: The New Yorker, mchumor.com

On the Internet, nobody knows you're a dog

Introducing insurance telematics

In the car, neither...

In the current motor insurance market, safe drivers are paying for... dogs

7

Page 8: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

U B I

Introducing insurance telematics

Source: PTOLEMUS

Who's doing what?

8

No telematics Telematics

Current motor insurance

Behaviour

No behaviour

PHYD

PAYDPAY-PER-MILE (Self-reporting- based policies)

INSURANCE TELEMATICS

STOLEN VEHICLE

RECOVERY

SAFETY SERVICES

(eCall / bCall)

CRASH FORENSICS

Page 9: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

Introducing insurance telematics

Source: PTOLEMUS - Note: Trials and launches in personal line & commercial lines

Usage-based insurance has reached all the most mature insurance markets

9

Usage-based insurance: Worldwide trials & launches

0 1 2 5 10 20 40

Page 10: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

0 25 50 100 150 200 250

Introducing insurance telematics

We expect it to reach new markets, notably in Asia

10

Insurance Telematics Study - Worldwide sales

Source: PTOLEMUS

Page 11: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS Source: PTOLEMUS, based on Gartner's Hype Cycle

The time has come for insurance telematics

11

Why insurance telematics matters

Insurance telematics has been through the peak & disillusionment phases

2012

Maturity

2013

The AA and Admiral launch PHYD offers

Gender ruling becomes applicable

Enlightenment

2011

NYC & Massachussets

investigate PAYD

models

Zurich launches Fleet

Intelligence PHYD offer

ÖSA launch telematics offer

in Germany

Test-Achats gender ruling

European Commission decides to mandate

eCall

Moody's recommends usage-based

insurance

Technology trigger

Peak of expectations Disillusionment

Unipol & Aurora launch Octo's solution Progressive

launches MyRate, 1st PHYD offer

2004

Progressive pilots TripSense

UBI program

2005 2007 2008 2009 2010

Renault launches

commercial line PAYD

programme

Norwich Union stops

PAYD programme

Norwich Union launches PAYD

offer

2006

Groupama launches

Amaguiz PAYD system

Towergate & Aviva launch

PAYD commercial insurance

Qualcomm launches

PAYD / PHYD solutionNorwich Union

launches PAYD trial

MAIF & MACIF launch unsuccessful

telematics offer

Launch of Coverbox by

Cobra Wunelli

Launch of Insure The Box

in the UK

Progressive renames MyRate

Snapshot Discount

Toyota & Aioi launch PAYD on

Toyota's G-Book

2003

Unipol trial of Octo's solution

Amaguiz launches 1st

OBD solution in Europe

Autoline launches 1st smartphone

solution

Progressive reaches 1 M

cum. UBI customers

OEMs freeze eCall devices

specs

Monti law implementation

1st OEM policies

ABI publishes good practice

guide

EC published

eCall delegated act to mandate

eCall by 2015

Page 12: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

Introducing insurance telematics

Source: PTOLEMUS

What are the market drivers of UBI in Europe?

12

TELEMATICS TAKE-OFF

Motor market imbalances

Economic crisis

Decrease of technology costs

Growth of online insurance

Increased customer acceptanceRegulatory

drivers

Competition

Page 13: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

Introducing insurance telematics

Source: PTOLEMUS market forecasts - Note: Includes eCall-enabled UBI

UBI is the fastest growing segment of motor insurance

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Market premiums generated from telematic policies (€ million)

0

5 000

10 000

15 000

20 000

25 000

2012 2013 2014 2015 2016 2017 2018 2019 2020

Motor insurance premiums generated from insurance telematics

FranceGermanyItalyUKRest of EURussiaRest of Europe

Page 14: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

Introducing insurance telematics

Source: PTOLEMUS

The paradigm of fleet motor insurance is changing radically

14

TODAY 2 0 2 0

CURE High claims ratioFraud, theft, etc.

PROTECT & PREVENT High expense ratio

Driving behaviour advice, eCall / bCall, fuel management, remote diagnostics, etc

OPAQUE & FOCUSED ON THE PAST No understanding of actual risks, only of past risks

TRANSPARENT & PREDICTIVEReal-time visibility on risks, crashes, thefts, etc.

DIVERGING INTERESTS "Higher premiums: more profits for the insurer"

ALIGNED INTERESTS"Lower premiums, lower claims: more profits for the insurer"

Page 15: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS

Introducing insurance telematics

"I have no time to see a salesman, I have a battle to fight"

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Page 16: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS 23

Conclusion

Telematics is changing the rules of the game

• The growth of telematics is just starting

- The gender ruling will show its effects- An age ruling is around the corner- We are now 28 months before eCall - How many insurers have really leveraged

telematics to reduce claims?

• Not all insurers will benefit

- "The data will come to us" is not the right strategy

- Pan-European telematic strategies & units in place

• The risks of standing still are far greater than the risks of moving to UBI

• But each insurer / broker needs to find its own way

Enjoy the conference!

Page 17: Introducing insurance telematics - Ptolemus · Our consulting services Procurement strategy Specification of requirements, launch of tenders, supplier negotiation ... OEMs & telematics

PTOLEMUS Consulting Group

S t r a t e g i e s f o r M o b i l e C o m p a n i e s

Brussels - Hamburg - London - Madrid - Milan - Paris - [email protected]

Frederic Bruneteau, Managing Director

[email protected]+32 4 87 96 19 02 @PTOLEMUS