Falling device costs can help technology expand out from young driver market
Octo Telematics UK managing director Martin Williams has predicted that telematics will break into the mass market as falling device costs open up new opportunities for the technology outside of its traditional young driver sector.
“Device costs and service fees [are reducing], which makes it more palatable on the lower premiums,” he said. “Young drivers clearly have a higher premium, which makes it more affordable to have a device and run it, but as device costs come down, that opens up other sectors.”
Research by Biba, released in January 2014, revealed that sales of telematics insurance had increased by 60% in 18 months, with 296,000 policies sold in 2013.
Williams said that under its partnership with telematics managing general agency (MGA) Insurethebox, more than 300,000 Octo ‘black boxes’ had been installed in policyholders’ cars since 2010.
“It is still not where the industry would like it to be, but the adoption path from a consumer basis is growing, and hence our share of that is growing as well,” he said.
Octo recently extended its contract with Insurethebox.
Williams said it was the quality of the data provided by a ‘black box’ compared to a smartphone app that was driving the partnership forward.
“Insurethebox is very much focused on the quality of data to exploit at the back-end for the crash and claims services,” he said. “It currently does not have a mobile app solution and the Octo device has an external accelerometer, which gives a much higher quality of data.”