Insurance Telematics USA 2013 Winning through Differentiation September 4, 2013

Why differentiate? All telematics programs starting to look alike Consumers cant tell the difference Growth is only possible by doing something different – Differentiation – Segmentation

Ideas for differentiation Vary the audience Think of past, present and future Work towards your business goals Lots of details

Differentiation options Creating an offering – Simple Distance Location Seasonality and rare usage – Complex Behavioral – Psychographic – Demographics – Coaching Contextual knowledge – Weather, traffic

Program progression Give yourself the best start possible – Meet your business goals – Prepare yourself for increased competition – Ensure your solution can leverage the future of telematics

Be goal oriented Use telematics to surpass your goals – Pricing models – Customer relationships – Driver education and coaching – Increasing risk tolerances – Market penetration

Program details Involve as many parts of your organization as possible Dont forget your agents, brokers, member services, etc…

Segmentation Personal lines – Broad base – Young drivers – Mature drivers – Non standard Commercial/Profession al Lines – Behaviormatics

Young drivers programs Value for insurance carriers – Risky segment Value for parents – Peace of mind Value for teens – Safety and independence

Mature drivers programs Value for insurance carriers – Risky segment Value for guardians – Peace of mind Value for elderly – Safety and independence

Fleet program Value to the carrier – Method to enhance business Value to the fleet owner & manager – Better understanding of drivers – Immediate cost savings Value to the driver – Education & coaching

Multiple segments An insurance carrier can target multiple segments with same platform – e.g., Young Drivers + Usage-Based Insurance

Premium services Source: Telematics Update Survey 2012 Value added services help overcome key barriers to UBI growth – Consumer adoption – Business model 15% 12%

Consumer Adoption Augment the value of the telematics proposition Start with pricing Go beyond pricing – Connected car services – Rewards & recognition

Business Model Premium services can reduce the insurance carriers costs – Policyholders will pay for value in their connected vehicles – Third parties will pay to lease part of the OBD-II port

Telematics-Enhanced Roadside Assistance Vehicle Health Monitoring & Reporting Automatic Crash Notification Voice Powered In-Car Infotainment Connected Car services are going mainstream Value of Premium Services

Think beyond data Leverage Connected Car technology as CRM Tool Increase revenue potential and reduce program costs Control high risk behavior – i.e. Texting & Driving Make adoption of UBI easier

On-going differentiation Differentiation is not a single step, it is achieved in an ongoing process Continuous innovation – Data acquisition – Analytics – Connectivity – UBI within the connected vehicle ecosystem

Differentiating Elements: A Driver-Centric Perspective Smart Data Acquisition Context-Relevant Representation Advanced Analysis and Visualization Advanced Traveler-Centric Feedback Loops

Smart Data Acquisition: Relevant In-Vehicle Enablers For Diverse Needs

Data Quality and Context-Relevant Representation

Extracting Value with Advanced Analysis and Visualization

Frontal impact

Algorithms to Understand Driving and Driver Behavior Moving beyond harsh braking and acceleration … Toward understanding driver intent

Data, Intelligence, and Feedback Data management – Density – Diversity – Frequency – Quality – Longevity – Latency – Privacy – … Data transformation – Insights – Intelligence – Decisions – Actions – … Coffee taste wheel

Summary Business objectives, goals, strategies and measures will drive the selection of insurance telematics Differentiation is the key to success – Stand out from the crowd – Provide advantages over the competitors – Develop a roadmap of innovation

Conclusion The IMS DriveSync platform provides for all this differentiation USA for Presentation and Collateral resources