IMS Blog

Market Share of Usage-Based Insurance Policies Doubles In One Year, Report Says

A new report shows that the market share of usage-based insurance (UBI) policies has doubled in just the past year. The report, which was completed by consulting firm Ptolemus, also found that 170 new UBI programs have been created in the last eighteen months alone. Ptolemus’ 800-page report, which includes 38 case studies, 360 charts, 56 applicable patents, 20 country profiles, and 10-year forecasts, is based on interviews with insurance industry figures from around the world. It found that the most prominent trend in that industry is usage-based insurance.

Now that UBI programs are becoming established in the United States, United Kingdom, and Canada, Ptolemus says it’s seeing new markets embrace the idea. For example, both Russia and Italy have begun implementing UBI programs on a wide scale. A number of countries in Latin America are also moving towards UBI models.

Ptolemus says that, at this rate, there will be more than 100 million UBI policies generating an astounding $80 billion in premiums by the year 2020.

As for how those policies might operate, Ptolemus says it expects the smartphone to play a key role. That could include using mobile applications to track driving behavior and how that behavior affects a driver’s insurance payments.

Ptolemus says that most insurance companies who adopt UBI programs will continue to use the ‘little black box’, or WiFi dongle, that is installed in a vehicle and wirelessly transmits information to an insurance provider. These types of devices are already becoming quite prevalent in the United States, and Ptolemus says it expects such hardware to become more available in Europe very soon.

White Paper – Big Data Transforms the Automotive Market

White Paper – Big Data Transforms the Automotive Market

DOWNLOAD