ARLINGTON, Va., June 07, 2017 (GLOBE NEWSWIRE) -- Over the next two years, more than half of all drivers (55%) who participated in leading global advisory, broking and solutions company Willis Towers Watson’s (NASDAQ: WLTW ) U.S. consumer usage-based auto insurance (UBI) survey , said they are likely to buy a new or pre-owned vehicle equipped with new technology features. The survey examined how the spread of in-car technologies and connected cars is influencing consumers’ buying behaviors and attitudes toward UBI.
“Steady innovation from auto manufacturers means newer vehicles increasingly roll off the production line already equipped with the technology and connectivity for a whole host of applications, including UBI,” said Katie DeGraaf, global telematics sales and delivery lead, Willis Towers Watson. “Connected cars could therefore create a whole new dynamic and impetus for the UBI market in the next few years.”
The survey found that a large majority (81%) of the roughly 10% of drivers who have or have had a UBI policy to date are very positive about its benefits. In addition, about the same amount said they’re willing or open to sharing their recent driving data, such as the past month’s data from navigational apps or an in-car system, for personalized insurance quotes. A similarly high number (84%) would be interested in or open to having short trial to determine the discount they could get before buying a policy.
“Drivers of all ages are embracing new driving technology, and many are willing to share their driving data in exchange for personalized insurance,” said Geoff Werner, global telematics product lead, Willis Towers Watson. “The key aspect of connected cars in relation to UBI is enabling policyholders to determine at the quote stage if a telematics policy will benefit them before they buy one, but this works only if consumers are willing to share recent driving data to receive a personalized quote.”
Although willingness to share driving data is a prerequisite, consumers also have to agree to the principle that their auto insurance cost is determined by how they drive. According to the survey, resistance to that idea is very low, with only 7% disagreeing with the premise that UBI is a better way to calculate premiums than traditional methods. The driving-related activities most survey respondents consider deserving of discounts are careful driving, low mileage, reduced speed and avoiding distractions.
“The survey results promote the ideas that technology can be used to understand driving habits, make auto insurance premiums fairer and give individuals greater control over insurance costs. These concepts have definitely gained significant traction from drivers since our last survey, underscored by an appreciation of the potential broader benefits to society,” said Werner.
Of the additional features commonly available with UBI policies, the three most valued by all drivers in the survey are automated emergency callout (45%), theft tracking (38%) and breakdown notification (35%). The opportunity to earn rewards, such as gift cards and vouchers, also appealed to over a third of respondents.
However, respondents did voice some important decision-making considerations, such as the possibility premiums might increase (50%); concerns premiums could fluctuate, thus making budgeting more difficult (38%); and how insurers might share their data (38%). “The more consumers buy connected cars and related in-car technologies, the greater the UBI adoption will be,” said DeGraaf. “Many, particularly among the younger generations, are leaning in this direction, with exciting prospects for carriers that can find the right balance between cost, premium stability, rewards and range of benefits.”
About Willis Towers Watson
Willis Towers Watson (NASDAQ: WLTW ) is a leading global advisory, broking and solutions company that helps clients around the world turn risk into a path for growth. With roots dating to 1828, Willis Towers Watson has 40,000 employees serving more than 140 countries. We design and deliver solutions that manage risk, optimize benefits, cultivate talent, and expand the power of capital to protect and strengthen institutions and individuals. Our unique perspective allows us to see the critical intersections between talent, assets and ideas — the dynamic formula that drives business performance. Together, we unlock potential. Learn more at willistowerswatson.com.
Media contact Josh Wozman: +1 703 258 7670 josh.wozman@willistowerswatson.com
