NAIROBI, Kenya, Jul 24 – Heritage Insurance Kenya has launched the country’s first telematics motor insurance, dubbed Auto Correct motor insurance.
According to the Insurance company, the service makes use of telematics capabilities together with data and analytics to promote safety and enhance customer engagement.
The service is powered by telematics technology – a method of capturing and processing driving data.
The device collects and transmits driving behaviour relating to acceleration, braking and cornering, all of which are key factors in evaluating how well or poorly a vehicle is driven.
A comprehensive formula makes use of the driving data collected to calculate an appropriate driving score.
With the anticipated reduction in the overall claims to the company, the customer is expected to benefit through reduced cost of insurance achieved through premium cashback to the customer at the end of each policy year, based on the customers’ overall driving scores.
According to the company’s Managing Director Godfrey Kioi, the new service targets to enhance service delivery and significantly speed up claims payment.
“Heritage’s Auto Correct promises a blend of intelligent black-box technology, driver feedback and attractive rewards aimed at improving driver behaviour, potentially reducing both accident frequency and the cost of insurance,” he added.
According to the company, all private motor vehicle owners are eligible for Auto Correct and may potentially get up to 15 percent cash back on annual paid premiums at the end of their policy period, if they drive safely.
They will also accumulate loyalty points, which can be redeemed from time to time at selected service providers.
Auto Correct comes with a smart phone app, that provides, among other things, driving feedback, weekly, monthly and annual scores as well as the accumulation and management of loyalty points. The app also provides information on where and how to redeem the loyalty points.
“Telematics is not limited to the pricing of motor insurance or driver behaviour. Our philosophy is cementing customer-centrism in the industry by engaging the customer and generating rewarding and memorable experiences,” Kioi said.
Kioi hailed technology’s timely entry into the insurance market with digital technology being at the cusp of disruption across industry sectors, raising customer expectations and forcing insurance firms to rethink their service delivery.
“Our usage-based insurance (UBI) product, Auto Correct, is a feasible answer to the ever-changing customer journey and industry, which has seen the emergence of innovative customer channels and millennial adoption of new technologies. Usage-based insurance (UBI) and acceptance of telematics capability in modern vehicles is expected to outpace traditional insurance,” added Kioi.
To enable ease of uptake, Heritage Insurance has provided an Insurance Premium Financing (IPF) payment solution, available on the mobile phone. “This value-added service is aimed at reducing the perennial premium collection problem in the insurance industry.”
Consumer opinion suggests that such innovation could help repair the existing mistrust and resultant high customer turnover in the insurance industry. This is due to the low confidence in insurance claims processes, which has affected long-term value optimization. Overall, the industry must adopt such innovation to redirect focus back to the end-customer experience.
The country’s insurance penetration rate, the contribution of insurance premiums to GDP, has been relatively low compared to the world’s average of 6.1 per cent and 3 per cent for Africa.
The internet and mobile phone revolution are expected to widen access to a diverse range of insurance products. In 2018, the number of active mobile subscriptions and internet users stood at 49.5 million and 43 million respectively. This presents a connectivity opportunity, touted to have a bottom-line impact on ease of enrolling and paying for insurance products.
With Auto Correct, Kenya, through Heritage Insurance Kenya, becomes the first country in East Africa and second in Africa, after South Africa, to launch a telematics motor insurance solution to the market, that also comes with a premium financing option.