Over the past year, Octo has seen significant interest in telematics solutions for commercial auto insurance. As insurers start seeing results from their personal auto usage-based insurance programs, they look for new ways to leverage telematics technology. With half of the 13 million commercial vehicles in the U.S. connected via telematics, bringing telematics to commercial auto insurance is a logical next step.

Price-based competition in commercial auto insurance has been a major driver of increasing combined ratios over the past few years. Often in our discussions with insurers, we come to the same sticking point — with record high combined ratios, they cannot make the business case for offering significant discounts to their commercial customers in exchange for telematics data.

While cost is often the most critical buying criteria for commercial insurance, insurance products that add significant value for policyholders help insurers differentiate themselves in the market. For most companies, auto insurance represents just a small portion of their overall business insurance, minimizing the impact of discounts. Instead, commercial customers look for partners who can add value and help them improve their bottom line.