Asleep at the wheel?

If you are a car insurer, and you are not taking note of what some of the auto-manufacturers are up to - you should be.

Tesla's insurance activities are attracting a lot of insurance industry attention, leveraging the connected car data as a key pillar in redefining the motor insurance business model. Ford Motor Company is also very active in looking to share connected car data, seemingly with a view to prime connected car type offerings. GM now looks to be ramping up its activity, partnering with American Family Insurance.

Will the auto-manufacturers have the patience, skills and appetite to change the game? I don't know. They have tried, without a lot of success, previously. Nonetheless, it will fascinating to see how this plays out and how the large incumbents will respond - some are certainly more active than others.

Some interesting quotes in this article to provide some insights into the thinking behind these activities:

"The goal is to be 30 to 40% cheaper for insurance...That’s the endgame.″

"Auto insurance is unlikely to ever be the largest business at either company, or even close. But insurance is shaping up as a way that the finance side of automakers’ business can help drive innovation and make adoption easier – as the data generated by the cars themselves is captured to deliver lower insurance prices and, automakers hope, cement customer loyalty."

"GM is moving fast, too...working on a safe driving behavior algorithm developed jointly with American Family Insurance...the company’s “vision to offer a more fair/personalized insurance product to our customers.”

"At Allstate, more than two million customers are enrolled in telematics programs. In states where the plans are approved, 21% of our auto customers are currently enrolled and 35% of new Allstate auto customers choose the plans"

Source: CNBC