ThingCo chief executive explains that smartphone apps may offer a cheap solution for insurers and brokers, but they don’t enhance the claims process

Increasing numbers of insurers and brokers are testing telematics with their customers through the use of smartphone apps, however Mike Brockman, chief executive at insurtech ThingCo, warns that this is a dangerous strategy that could instead lead to policyholders having their insurance mistakenly cancelled.

Brockman states that although apps are a cheap and simple way for insurers and brokers to begin to offer telematics, they also have a tendency to be inaccurate, which could lead to the automatic cancellation of telematics-based insurance policies, for example if a driver is recorded as speeding when they were, in fact, maintaining the speed limit – the potential for this situation to arise makes Brockman feel “nervous”.

He continues: “I’ve personally never been a big fan of telematics apps because it’s a cheap solution. The value you can get from it is limited because the accuracy of a phone is nothing like a specialist device that’s fitted to do a particular purpose.

“In terms of trends, apps are getting more popular, purely because they’re cheaper. It’s an inaccurate solution and doesn’t allow you to manage claims or anything like that very well.”

The temptation for insurers and brokers to turn to easy-to-use apps is linked to the complexity of telematics in terms of finding the sweet spot between expensive installation and device costs versus offering discounted premiums by reducing customer risks.

“The insurance industry as a whole has found it quite difficult to get to grips with it,” Brockman admits.

“The cost is quite expensive, so if you have a fitted black box, you’ve not only got the cost of the device, but you’ve got the cost of someone going round to fit it and, to make it work for the broker or the insurer, they have to get more value of it then the cost of the device and the fitting and they also have to give away a discount to the customer because that’s the whole purpose of it.

“The only way they can do that is by reducing the risk of their customers and giving them a better claims experience when they have a claim and that pays for the technology. It’s always been a bit of a tricky model to get to work if you don’t really know what you’re doing.”

Mike Brockman Headshot

Mike Brockman

Improving the claims process

With this mind, using telematics technology to improve the claims experience and streamline the overall claims process is vital to ensure a financially viable telematics-based model.

For Brockman, this is centred around using telematics to collect real-time data that can quickly and reliably inform various stages of the claims journey.

He says: “Technology now is moving fast to make that whole experience much better and I see that as a big change that will happen in the next five years.

“With technology, I see that the whole claims process will be able to be tidied up a bit and the more information you know about the accident, the more you can handle that claim much more efficiently on behalf of the customer.”

Brockman uses determining liability as an example here. “Insurers always say never admit liability, but until someone admits liability, that determines who pays for the cost of repair, so if technology could say well it’s definitely a no fault claim or it’s definitely a fault claim or it’s 50/50 on an evidence base, you could improve that whole process and speed up the whole repair process because it’s all about getting efficient sign off from the insurers who are involved in that accident,” he explains.

Alongside the growing prominence of technology within these processes, Brockman further predicts that more insurance businesses will need to partner with insurtechs for their digitally-savvy expertise and up-to-date technology.

He adds: “The modern-day insurance world is changing. Technology is changing so fast, the problem for insurers and brokers is that the technology they have is a bit old. I see the insurance industry will be doing a lot more partnerships with insurtechs so they can tap into the latest technology.”

At ThingCo, this includes what Brockman describes as the “next generation of telematics” – its new solar powered, self-installed Little Theo device, designed to be used in partnership with insurers and brokers. Launched in April, the device also uses voice commands.

According to Brockman, the ongoing Covid-19 pandemic is having far-reaching impacts on the motor insurance sector specifically. With Britons in lockdown not driving their cars as much, motor insurers are sitting pretty on premiums without needing to pay out on claims. However, it is those working within the claims process itself that are feeling the pinch, he says.

“The people in the claims side of the equation, which you need for the long-term, all the car repairers, the car rentals, the solicitors, everyone that depends on claims, are having a really, really hard time because they haven’t got any income,” Brockman continues.

“Eventually that’s going to be a problem in terms of the supply chains for the insurers because a lot of these people in the claims infrastructure potentially could all go bust.”

Outside of this year’s coronavirus pandemic, Brockman further notes that motor insurers’ main sticking point has swung from personal injury claims to accident repair costs, which have escalated due to cars being more technologically advanced.

He says: “New cars these days are all much more sophisticated, especially when you come to electric cars, but all cars now are having all sorts of sensors - what that means is if you have a relatively minor incident, it costs the insurer a hell of a lot to get it repaired. And a lot of repairs now are quite specialist.

“So, the cost of repair is really going up and up and up, so anything that you’ve got that helps manage that process, insurers will be interested in and next generation telematics is definitely technology that can help mitigate that risk.”


  • Founded ThingCo in 2018.
  • Founded Insure The Box in 2009, which launched in 2010 as the first black box only insurer.
  • Started career in actuarial roles at firms such as EMB Consultancy and Bacon and Woodrow.