Today's customers expect the brands they shop with to know enough about them to offer personalized products and services. (Photo: Shutterstock)
The days of the "one size fits all" model in the auto insurance industry are dwindling as demand for a more personalized experience grows. When shopping for auto insurance, more and more people want to be treated as individuals with unique driving behaviors that vary by contextual situation — not as a statistic. Smartphone telematics, big data and artificial intelligence are making personalized auto insurance more possible today.
Recently, industry newcomer Root Insurance — a start-up that offers customers a personalized auto insurance experience through a model similar to usage-based insurance (UBI) and behavior-based insurance (BBI) — will work towards accelerating this transition with its latest round of funding and a $1 billion valuation. This is one of the largest investments in UBI and BBI, but it won't be the last. Using innovative technologies, legacy companies with the reach to truly disrupt the industry can offer the same kind of personalized experience as the innovative, younger companies, but with the power to shape the industry's new direction.
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