Co-founder Paul Stacy said not enough insurers are taking telematics driving scores into account when pricing
New telematics data collected from thousands of drivers has revealed that crashes are 11 times more likely to happen on a 40mph road than a 70mph road.
The research by Wunelli which analysed driving behaviour from 170,000 motorists of 764 million miles over five years from smartphone apps and black boxes is revealed in a white paper, Thinking Outside the Box, launched this week.
It also found that the period between 3am and 5.59 am on a Saturday morning has the highest number of at fault claims, rather than Saturday night and Sunday morning. Wunelli’s analysis also found that the number of claims on Wednesday nights are rising.
Research and development director Paul Stacy said Wunelli has collected so much data that insurers will be able to quote premiums for customers on a sample of one, and to forecast the loss ratios of individual risks within weeks.
“Most insurers are currently under and over pricing premiums because they are not taking driving scores into account when pricing. We have been collecting data for 5 years and accumulated enough knowledge to say with certainty how the future can look for insurers if they use driving scores to personalise pricing,” he said.
“Insurers assess risk and driving behaviour tells insurers something very new about risk. So they should look at this seriously and accelerate what they are doing,” he told Insurance Times.
Stacy added: “The most important message is essentially the relationship we draw between driving scores and claims loss ratios.
“And if you want to relate it to the bottom line for the insurer, it is about how much do they pay out and how good are they at assessing risk?”
Stacy predicted a step change this year in the transition of the use of telematics as a niche young drivers’ product to a mass market one.
Increased customer awareness and a significantly lower cost for data acquisition from smartphone applications would boost the number of policies in the UK, he said.