In our previous post, we indicated the differences between traditional auto insurance and usage-based insurance (UBI), as facilitated by telematics and our Internet of Things Analyzer — msg.IoTA. In this post, we’ll give your more detailed indications of just how significant those differences really are.

The Norm

On average, a car accident happens every seven years or so. Consequently, most drivers don’t have anything like a claims routine. In fact, few of them have any idea what to do or what they should do first. And all of them are overwhelmed, dreading the prospect of going back and forth between insurance companies, towing services, and body shops, to say nothing of filling out lengthy forms in with handwriting that’s almost illegible because of their anxiety.

Think about this: People get so confused after accidents, they cannot discern left from right. They don’t recall the sequence of events in accidents. They don’t recall precise locations or dates. Many of their reports don’t match up with other versions of those reports or are completed too late. And claims business is still transacted by mail. Why? We have smartphones that can solve almost any problem, but our system of resolving auto claims is from the 1900s.

The New

How about these for some efficient steps?

1. A policyholder has an accident.
2. The telematics device, whether it is an OBD2 dongle, a windshield sticker, car itself or any other capable device, sends a crash notification to the insurance company that includes the G-forces exerted on the car and the angles from which they came.
3. The insurance company knows when and where the accident happened in real-time, can contact the driver immediately and offer all necessary emergency services such as an ambulance, a tow truck, a taxi, or a rental car if it’s included in the policy.
4. The claims manager knows the vehicle value, the crash severity, and if it makes sense to repair the car — all in less than 30 seconds of the accident.
5. A leasing company can be contacted and, instead of the policyholder’s having to make what might feel like innumerable calls, a lease vehicle is delivered to the policyholder’s home.

If the car does get repaired, the insurance company and the policyholder know, at any point in time, where the car is and how far the repairs have progressed. There’s no more need to send out an expert to check out a scratch. There’s no more wasting the time of highly trained and talented employees on simple cases. There’s no more spending three to five weeks of processing time because everything can be taken care of in 10 minutes or less.