Survey Shows More than 75 Percent of Policyholders Would Welcome Telematics-Based Insurance Program
Policyholders more comfortable sharing driving data with insurance companies than personal information on social networking sites, according to LexisNexis Risk Solutions Survey
New York, NY – According to the LexisNexis® Risk Solutions Telematics Survey, more than 75 percent of auto insurance policyholders in the United States would welcome a telematics-based insurance program if sharing their driving data had the potential to reduce their premium. The survey also measured consumer comfort levels around sharing personal driving information compared to other types of personal information from sources including Internet banking, mobile phones and social networking sites. The results showed that 57 percent of policyholders are comfortable sharing information about events that led to traffic accidents with insurance companies; a much higher response than the 29 percent who indicated they were comfortable with social networking sites storing personal information such as messages and photos posted on websites. The Telematics Survey, conducted by Lynx Research Consulting, measured policyholder receptivity to allowing insurance companies to use data collected from telematics devices in their vehicles to help determine rates.
Telematics systems in automobiles provide a variety of navigational and emergency services to motorists, e.g. GPS systems. Some insurance companies are beginning to use data collected from telematics systems to correlate driving behavior with insurance rates; however, storage of telematics data remains limited. Worldwide, 84 percent of all cars shipped by 2016 will incorporate telematics systems, up 19 percent from 2008 according to iSuppli Corporation.
The Telematics Survey was designed to help the insurance industry understand policyholder awareness of and attitudes toward, telematics systems and insurance programs based on telematics data. The study found that:
- 57 percent of policyholders believe auto insurance rates should be determined by actual driving data
- Policyholders' main concern is privacy; however they are more receptive to sharing driving data with insurance carriers than they are to sharing personal information with banks, or allowing mobile phone carriers to store text messages
- 80 percent of policyholders believe that tailgating should affect rates
- 59 percent of policyholders believe that miles driven per year should be used to determine rates
- More than half of policyholders feel that minor speeding infractions (5 mph over the speed limit) should not impact rates.
“The survey findings show tremendous receptivity to allowing insurance companies to base rates on driving behavior,” said Stephanie Stevens, director of marketing and product development for Telematics at LexisNexis Risk Solutions. “We encourage insurance companies to use the findings to re-evaluate how they shape and market their telematics programs to best meet the needs of their policyholders.”
The survey also identified telematics-based insurance programs that are of most interest to consumers. Topping the list were empowerment programs that give drivers control over their insurance rates and the opportunity to understand and modify their own driving behavior. Programs that focused solely on discounts were not as popular.
The web-based survey polled 3,472 U.S. residents. Of this number, 3,148 were a representative sample of insured drivers and 324 were drivers with a 16 to 25 year-old dependent on their policy. More information on the telematics survey is available by contacting firstname.lastname@example.org.
LexisNexis® (www.lexisnexis.com) is a leading global provider of content-enabled workflow solutions designed specifically for professionals in the legal, risk management, corporate, government, law enforcement, accounting, and academic markets. LexisNexis originally pioneered online information with its Lexis® and Nexis® services. A member of Reed Elsevier [NYSE: ENL; NYSE: RUK] (www.reedelsevier.com), LexisNexis serves customers in more than 100 countries with 15,000 employees worldwide.
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