Delivered September 2, 2019. Contributor: Teresa W.
To get up to speed on the challenges, opportunities, and trends in the U.S. Auto Insurance industry in order to be knowledgeable about what insurers are concerned about and struggling with.
With the rise of the gig-economy, specifically peer-to-peer ride sharing, insurance companies have had to determine how to incorporate these activities into insurance policies. Since the activities do not fall solely under commercial or personal, insurance companies have had to determine how provide insurance. Many are offering add-on policies.
Despite new technology in cars that make them safer, auto insurance rates are going up. With increasingly more complex components, cars are becoming more expensive to repair after a collision. In addition, they are taking more time to repair and require specialized mechanics.
New players and insurance delivery models are disrupting the auto insurance market. Usage Based Insurance uses telematics-technology to track driver behavior and bill premiums accordingly. UBI variations include Pay-As-You-Drive (PAYD), Pay-How-You-Drive (PHYD), Pay-As-You-Go, and Distance-Based Insurance.
The increased adoption and usage of new technologies appears to be the largest area of opportunity and challenge for the auto insurance industry for 2019 and beyond.
As competition increases from online aggregators and alternative delivery models, traditional auto insurance companies need to create better products and services in order to stay on top. Insurance companies will need to rely on big data and data analytics to stay in the game.
The increased competition is, also, impacting consumer expectations in terms of customer service. Traditional insurance companies are often not able to compete on price alone. Therefore, auto insurance companies must focus on providig exceptional customer service to retain policyholders.
As the auto industry ecosystem evolves with smarter and more connected cars, ride-sharing, and new varieties of automobiles, insurance providers are having to rethink their business models in order to stay ahead of the business.
Only the project owner can select the next research path.