Connected Vehicle Platforms for Dynamic Insurance

TL;DR

This study evaluates the readiness of connected vehicle technology for usage-based insurance, highlighting current challenges and potential high-value applications like luxury car insurance.

Contribution

It provides an assessment of the technological maturity and practical issues of using connected vehicle data for insurance purposes.

Findings

Connectivity testing of recent cars shows promising potential.

Data collection faces issues with data uniformity and enrollment.

Technology is suitable for high-value luxury car insurance use cases.

Abstract

Following a regulatory change in Europe which mandates that car manufacturers include an eCall system in new vehicles, many car manufacturers are adding additional services on top, so that more and more cars become connected vehicles and act like IoT sensors. In the following study, we analyse the maturity level of this new technology to build insurance products that would take vehicle usage into account. For this, the connectivity of recent cars a-priori eligible has been first tested. Then, an ad-hoc platform has been designed to collect driving data. In particular, 4 cars have been connected to this platform for periods of over one month. Our results highlight that, while this technological innovation appears very promising in the future, the pricing, the lack of uniformity of data collected and the enrollment process are currently three pain points that should be addressed to offer large-scale opportunities. In the meantime, this technology might still be used for high value use cases such as the insurance of luxurious cars.