The benefits of telematics-based auto-insurance products could go beyond better risk selection and pricing—and could include better fraud detection and the ability to provide feedback to consumers on CO2 emissions, fuel consumption and other factors that may lower the cost of driving, a new Celent report says.
In “Telematics-Based Insurance: Has Its Time Finally Arrived?” Celent says insurers are overcoming historic obstacles by employing telematics, or usage-based insurance products.
Celent adds that location data can also help “sniff out fraud gangs.”
Insurers can also provide insight on what is happening with the vehicle itself, with respect to CO2 emissions and fuel consumption. “This data can be fed back through the customer portal to support decisions around lowering the cost of driving,” says Celent.