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Telematics and IoT Solutions

Matteo Carbone / IoT Insurance Observatory and Swiss Re published research late last year. This research characterized how telematics and IoT solutions are deployed to reduce anticipated losses.

In the auto insurance case, Matteo suggests the most attractive proposition to be:

App-based monetary reward for good driving for existing policyholders.


‘Prize money’

This is based on two factors.  Firstly, 45% of policyholders have the same policy for more than 5 years.  Also, weekly feedback with ‘prize money’ shows best behavior change for those policyholders.

Simple, right?  Matteo kindly let us look in detail at their survey. We viewed this alongside our own annual look at consumer attitudes to telematics. Our most recent headlines showing trends from our 2020/22 surveys were:


Improve loss ratio

Let us lead with Matteo’s view that insurers need to move quickly to improve loss ratios. With this in mind, there are two areas where we concur and converge.

First is the belief amongst our consumer sample that their driving can be improved. This could be a positive contributor to policy value and a greater understanding of risk.

Secondly, improved behaviors will have a positive impact on incidents and claims.

So why is it not happening?

Matteo’s most important hypothesis is on ROI/business case.  The cost of the tech must be smaller than the losses prevented.  If we were to extrapolate the outputs of the two surveys, we could suggest the following:

  • Broad target audience, but segments clear from Matteo research (Telematics survey)
  • Low mileage to driver feedback and coaching propositions
    • Anti-theft & automatic emergency system secondary needs
  • App-only or app-and-tag solutions
  • Discount led with added benefits in the event of a claim, on your fuel costs and on the environment



Action needed!

Now with my commercial head on, the necessary call to action?!  Let’s do this?!  Insurers need action to improve loss ratios.  Consumers need to see value from insurers.  Telematics is the answer!