Digital insurance given €20bn price tag
Digital motor insurance policies could be worth €20bn in just three years, according to Deloitte.
Its research found that half of drivers would be happy to share their driving data in return for more personalised policies offering greater discounts based on their driving habits.
Deloitte UK head of insurance, David Rush, said, ‘This year’s survey showed a 20% rise in the number of customers willing to switch their insurance policy. When this ‘switchability’ is combined with people’s readiness to share their data and the rise of connected devices, the prospects for change in insurance are significant.’
It also found the UK was one of the countries with the most potential for development in digitally-enabled policies, alongside Italy, France, with the Italians.
In the UK, there are 450,000 telematics policies at present, making up five per cent of the market which Deloitte believes could rise to 23% with digitally-enabled insurance products by the end of this decade.
Although price is a major sales point for telematics insurance, the research states that this won’t be the only key focus for new insurance policies in the future, with car care services and free roadside assistance potentially on offer.
Deloitte insurance partner, James Rakow, said, ‘Digitally-enabled motor insurance is on its way to becoming an important offering in all European countries. Customers are also ready for a new insurance product where insurers would be more than just a risk carrier or a company that offers discount-based polices.
‘We could see new policies that not just include traditional motor cover, but also services like automatic emergency assistance or theft and recovery notifications, depending on the driver’s needs. Insurers who follow this path could emerge as winners in a redistribution of the market for motor policies.’