Jon Tindall. Trends in Telematics

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2 Jon Tindall Trends in Telematics

3 Today s presentation What s been happening around the globe? Asia in focus The new battleground Where are things heading? Market update The ANZ market OEMs CTP changes Wrap up It s moving slowly Why? Could this provide a push along? 3

4 Market update Canada South Africa Australia & NZ 4

5 Some action in Japan A few insurers have begun to play in the telematics space Off the back of the Insurethebox purchase in 2015 AXA is renting devices that measure driver behaviour Drivers receive prizes based on their driver score 105 million Zurich have started providing some new policyholders with devices largely for R&D purposes at this stage Sompo began distributing apps to policyholders Accidents decreased 20% y.o.y. across corporate policyholders offered gift certificates for good driving 5

6 Lots of talk about China 17x manufacturers have OEM telematics SBM described it as a gold rush ResearchinChina: Telematics equipped vehicles grew ~>30% in nine months to end of million units OnStar: Leader in connecting cars Unique business model consumer platform Brokers insurance Mobiles to vehicle tethering via apps that talk to each other 6

7 OEMs: The new battleground Apps and boxes: stepping stone to Pre-market telematics platforms OEMS poll positioned: Able to take advantage of and control data Post market solutions: Niche solutions provider competition In-built telematics: Deeper information than app-only Increased engagement Increased value proposition Mass-market barriers will reduce: Telematics will become an opt-out technology Insurance is only one use: Many opportunities for connected cars 7

8 When could the future arrive? History suggests that even with 100% penetration of the production line it still takes a significant time to get through the carpark Likely won t be >50% with in-built telematics until beyond 2020 in ANZ Will eventually be packaged with other products and services Barrier to entry and ongoing costs substantially reduced over time 8

9 Could CTP reform push the local market forward? CTP premiums in review Point-to-point CTP in review Level the field with ride sharing Minimum usage based. Other options include on-time and location Telematics already collecting data opportunities If successful: Evolution of greenslips? Premium rating flexibility? 9

10 The next couple of years Insurers want to: Learn from OEM data Understand the technology Test system impacts Be Prepared! Insurer-customer propositions currently in transition, not developed: Large-scale telematics will struggle if costs reduce and reliability and content increase Pre-market vehicle technologies = Barrier entry reduced, awhile until standard Some barriers to local industry development will decrease over next five years: Device costs Bodily injury rating 10

11 Questions?

12 Contact Jon Tindall Senior Consultant Tel: jon.tindall@finity.com.au

13 Distribution & use This presentation has been prepared for the Finity Consulting Pricing & Analytics Seminar, held on 18 October It is not intended, nor necessarily suitable, for any other purpose. Third parties should recognise that the furnishing of this presentation is not a substitute for their own due diligence and should place no reliance on this presentation or the data contained herein which would result in the creation of any duty or liability by Finity to the third party. Reliances & limitations Finity wishes it to be understood that the information presented at the Seminar is of a general nature and does not constitute actuarial advice or investment advice. While Finity has taken reasonable care in compiling the information presented, Finity does not warrant that the information provided is relevant to a particular reader s situation, specific objectives or needs. Finity does not have any responsibility to any attendee at the conference or to any other party arising from the content of this presentation. Before acting on any information provided by Finity in this presentation, readers should consider their own circumstances and their need for advice on the subject Finity would be pleased to assist.