Even if the nominal growth rate of premiums is around zero, the motor insurance sector displays a + 3.8%, the best performance in the industry.
But what could short and medium term trends be?
Recent surveys held by primary institutions show that, within the year 2020, the share of “digitally enabled” motor insurance policies issued in Europe will reach 17% of the total, with a peak of 27% in Italy and 23% in the UK. From 2020, that share has even more room for improvement, and in the same surveys the part of customers willing to share their data with insurers reaches 28%, with Belgium in the top position (40%) and the UK in second place (35%). According to clients’ preferences Banks and Insurance companies are in the top three institutions to share data with, and over 50% of customers are willing to do that in order to benefit from additional services.
When we talk about “digitally enabled” motor insurance what exactly do we mean?
They are insurance policies that include a connection between the customers, their car, and the insurance provider: this allows customers to benefit from the best services and prices, bespoke to the driving style of each driver. To do that, the device records data while driving, and sends these to the provider: it is possible to use a multiple transmitter, a black box connected to the car computer or to the engine dongle, or even to our smartphone enabled by a particular app. This sounds like science fiction, but it’s not: the EU decided to make the black box mandatory on all the new engineered cars from 2019. *
Motor insurance is more than important for FCA Bank: in 2017 - the first full year of business - we achieved impressive results:
- it ranked first for contribution to insurance business economics, representing 50% of the total value;
- nearly 200.000 contracts for financial products included motor insurance: it means a 21% share of total contracts financed on 2017;
- more than 1 financing in 3 includes a motor insurance.
However, we still have great possibilities ahead: the best performing markets are reaching a penetration rate that exceeds 60%.
And what about the future? FCA Bank is fully involved in this “innovating wave”, exploring in the meantime many streams of opportunities: together with our Brands and Partners the investigations about future business models are ongoing, testing new devices and fine tuning new ideas. When those important changes will become reality, FCA Bank will be fully ready to offer to Customers the most valuable solutions to generate added value.
*Source: European Motor Insurance Study The rise of digitally-enabled motor insurance, Deloitte