With Americans clocking more time behind the wheel than ever before, additional miles can be a challenge to auto insurers. How can insurers make a dent in accident frequency and severity, both of which are currently on the rise?
Data tells the story. Americans drove a combined 3.1 trillion miles over the 12 months through March 2016, with the average auto liability claim for property damage at $3,493 and bodily injury at $17,024, according to research from Verick Analytics. Not coincidentally, in 2015, the United States experienced the "highest one-year percentage increase in traffic deaths in half a century," according to the National Safety Council. But what if an insurance company could reduce both the frequency and severity of claims?
By having telematics data available for claims management, consumers and insurers alike could gain a better understanding of how to mitigate claims — almost before they happen. Data from a vehicle could alert drivers to vehicle problems, such as low tire pressure that might lead to a blowout, or warn of impending storms so the car could be under cover, protected from hail or similar weather related perils. By offering driver feedback on vehicles and driving behavior, an insurer can engage customers in new practices that provide value, with the potential for increasing customer satisfaction and loyalty.
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