In the world of technology, there is no such thing as a “linear” change. Ever since the coming of the internet, advancements in digital technology have been exponential. We are seeing an explosion of different technologies that not only let us stay more connected, but digital technology is improving itself without human intervention. And every industry is benefiting from these advancements. This adoption of digital methods has been seen in the auto insurance industry as well.
Auto insurance is a crucial part of our lives. If you plan on driving a car, you cannot escape from auto insurance. But getting car insurance was once a complicated process, and making insurance claims was even more complicated. But thanks to auto insurers adopting digital ways, things are easier than ever. But it does not stop at being easy.
Here’s how the digital transformation is affecting the auto insurance companies, their employees, customers, and everything associated with it.
Easier Quotes and Claim Processes
There was a time when you’d have to wait for days to get an auto insurance quote. And if you wanted to get more information about a policy, say liability policy or personal injury protection, you’d have to visit their offices or get an insurance agent.
Now you have your personal auto insurance agent in your pocket, and that too for free. With the coming of powerful web structure, interactive and real-time algorithms, and more flexibility in the digital space, auto insurance companies have practically set up their “digital offices” on the web that you can visit with just a click.
Getting car insurance online is only a matter of minutes. Faster insurance quotes and the best part is you can claim your auto insurance policy from your smartphone with only a few clicks. All this power sits right in your palm, and that’s because of the digitization of the auto insurance industry.
Better, More Personalized Plans and Pricing
We all like services if they are personalized. You’d love to get a playlist that has all the songs you’d prefer, or go to a diner where only your favorite foods are served. This was not the case with auto insurance companies a few years back. You’d have to fit in their offering and the way they offered their services by cutting down your preference.
But with the coming of digitization, and the already abundant data from all the social media platforms, auto insurers can use all the customer information (ethically and within boundaries, with permission) to create a more personalized offering that is better suited for individuals, at a great price.
Along with the customers’ general information, credit score, and other factors, auto insurers can suggest different policies, the best way of getting policies (if they have multiple cars, they can get better discounts and perks), and much more. So not only do you get affordable car insurance, but you only pay for the things you need. Speaking of paying for things you need, let’s segue to the next point.
The Rise of Pay-per-Mile
Who would want to pay for things that they don’t need or use? Then why would you pay for auto insurance that you’d never use? With the coming of digitization and powerful software and connectivity, there has been a rise in the demand for pay-per-mile auto insurance.
In pay-per-mile auto insurance, you only pay for how much you drive, like paying for gas. Automobile insurance companies can make powerful applications that connect to your car and can get vital information such as your average speed, mileage, and other diagnostic information to calculate a precise rate for your auto insurance.
This allows you to get cheaper car insurance that offers all the benefits of great coverage. The auto insurance companies can manage risks better, while you get to pay less. It’s a win-win situation!
Risk Analysis for Better Rates
One of the biggest reasons why auto insurance rates might be very high for you could be the higher risk associated with you. Auto insurance companies consider multiple factors such as driving record, traffic violations such as speeding tickets, DUI charges, past insurance claims, etc. If they consider you to be a high-risk individual (that means you are more likely to be in a car accident and make an insurance claim), they will charge you more.
Some companies even look at your credit score and if it is low, you get to pay higher premium rates. But all that is changing with the coming of better risk analysis. Car insurers are using a powerful software that integrates artificial intelligence, machine learning, and real-time statistical analysis to predict the chances of an individual getting in a car accident.
This means that you won’t have to pay more due to poor analysis from the auto insurance company. A better risk assessment would also mean that minor traffic violations won’t carry too much weight in increasing your auto insurance rates as well.
Auto Insurance in Your Smartphone
Instead of going to different places, hiring an auto insurance agent (who charged you a hefty amount of money), and getting into the hassle of choosing the best auto insurance company (or policy) with the risk of making the wrong choice, all you need to do is open your browser on your smartphone and get a detailed list of all the pros and cons, reviews, and prices of different insurance companies and their offerings.
This ability to have such enormous data presented to you in a detailed way has done wonders in helping you make the right decision. The power to compare different features and prices of all the auto insurance companies helps you save so much money. All of this is possible due to digitization and its adoption by the auto insurance industry. In the coming years, all these features will keep getting better, more efficient, and of course, beneficial for both insurers and customers.