Report
Teaser, summary, work performed and final results
Periodic Reporting for period 1 - FAIR (Future Advanced system for an on-demand Insurance Reliable product based on driving behaviour analysis)
Teaser
As in the “old economy†(let us call it, the Product Economy) it was all about things, acquiring new customers, shipping commodities, billing for one-time transactions. Conversely, nowadays it is all about relationships: more and more customers are becoming subscribers...
Summary
As in the “old economy†(let us call it, the Product Economy) it was all about things, acquiring new customers, shipping commodities, billing for one-time transactions. Conversely, nowadays it is all about relationships: more and more customers are becoming subscribers because subscription experiences built around services meet consumers’ needs better than a static offering or a single product. But not only: the digitisation of machines, vehicles, and other elements of the physical world is a powerful idea. In the idea of changing and improving the insurance sector, one of the main objectives of the FAIR project is to shift the traditional Insurance Sector to a new subscription business model, according to the effective driving behaviour of the customer, adapting the insurance tariff according to the actual driving style of the individuals and their risk.
During this first year of Project, FAIR partners have started to develop a behavioural and predictive algorithm, with the aim to provides useful data that will increase real-time monitoring, improve maintenance, increase safety, create customised insurance policies, and reduce cost associated to insurance premiums.
FAIR is aimed at launching, at the end of the two years’ Project, in the market a platform that enables insurance product fully integrated with cars, based on telemetry and driving behaviour analysis for the implementation of a new business model.
In terms of economic and social impact, the development of these new insurance and technological products will allow a shift from the traditional insurance model to a new business model that allow as main economic benefits for the users and unique selling points, such as car dealer and fleet companies, the improvement of customers retention up to 18%. This, moreover, will turn into a relevant increase in marginality for these subjects. On customers side, private owner of the vehicles, the new insurance products, based on pay-as-you-drive idea, will allow them to save from 20% up to 40% with regard to conventional insurance tariff. An additional 10% cost saving is guarantee by the digitalisation of the process, selling the insurance products and warranties through the mobile APP.
Work performed
During this first year Project, FAIR consortium has worked on several main topics, such as: Architecture Software platform creation and developing, legal insurance framework aimed to analyse the possibility of selling insurance on-demand through App and based on Pay-Per-Use driving. Furthermore, data management, IP and patent framework, Risk analyses have been performed as first release in the last months. Consortium has already started to plan a strategy for the dissemination and exploitation of the on-going developing products for car dealer, fleet managers, private drivers and so on.
Furthermore, with the main objective of developing an innovative on-demand insurance product, which can be purchased through APPs by private customers, and the provision of specific products for car dealers and fleet managers for the management of their vehicle fleet, FAIR has addressed the main issue of a delay in the Italian insurance market in incorporating this type of innovative insurance product. Many companies, today, are more focused on the analysis of crashes and related frauds.
At the same time, however, FAIR has stared to analyse the insurance legal frameworks, with a first focus on the innovative insurance approach in the Italian Legislation and a preliminary study at European level (EU28).
Meanwhile, close relationships were established with various companies for the creation and development of these products.
As regards, instead, the products dedicated to the car dealers and fleet managers, following meetings, it turned out to be of particular interest for the latter for the evaluation of the health status of their fleet and the maintenance of the vehicle value over time.
Final results
The aims of the Project are to shift the traditional Insurance sector to a New subscription business model, according to the effective driving behaviour of the customer, with an adapting insurance tariff, and the developing of an on-demand insurance policies and warranties connected directly on customers’ smartphones.
This allow as main economic benefits for the users and unique selling points, such as car dealer and fleet companies, the improvement of customers retention up to 18%. This, moreover, will turn into a relevant increase in marginality for these subjects. On customers side, private owner of the vehicles, the new insurance products, based on pay-as-you-drive idea, will allow them to save from 20% up to 40% with regard to conventional insurance tariff. An additional 10% cost saving is guarantee by the digitalisation of the process, selling the insurance products and warranties through the mobile APP.
Website & more info
More info: http://www.fair-myair.eu/.