Heritage Insurance Leverages Telematics To Discount Premium

Heritage Insurance has launched a new method of data collection through telematics devices, that they have successfully used to discount premiums for automobile customers.

Fitted in the vehicles on its AutoCorrect motor insurance policy, the telematics device have shown that 46 percent of insured motorists drove less in the month of April. This is compared to their monthly driving range over the previous six months, an occurrence which is attributed to reduced movement and most people working from home.

“Motorists who have insured their vehicles with Heritage Insurance will benefit from a reduction in premiums, on the basis of reduced driving due to restrictions imposed by the Government as a result of the COVID-19 pandemic,” said Godfrey Kioi, Heritage Insurance Kenya’s Managing Director.

Given the reduced exposure, Heritage Insurance has will give a 5 percent refund to its policyholders, based on each individual’s level of reduced driving in April 2020 compared to their normal driving range, and a  7.5 percent discount on the annual motor vehicle premium for customers converting to AutoCorrect during the months of May, June, and July. The insurer also offers a 15 percent discount to motorists on the motor cover for the months of May and June 2020.

“This Covid-19 phase has raised a lot of questions for conventional insurance products. Kenyans are concerned that while their cars are stationary, insurers are still collecting premiums from them at normal rates. Usage and miles-based insurance provides a solution that allows us to peg pricing on vehicle use and driver behavior and most importantly, cushion our clients in these tough economic times,” continued Kioi.

Speaking during the announcement, H.G Thanawalla Insurance Brokers Limited Managing Director, Mr. Taj Thanawalla said: “This discount is a material relief for customers, in these tough times. It is a clear demonstration of the use of innovation to drive data-based and intelligent pricing, for the benefit of both the insured and the insurer.”

The AutoCorrect Rewards Programme, a points-based loyalty program that rewards drivers for good driving and that is powered by telematics capability was launched last year. Built on a platform that integrates the Internet of Things (IoT) and Big Data, Heritage’s AutoCorrect is the first telematics-based insurance product in Kenya and exemplifies innovation in the sector.

“At Heritage Insurance, we recognize that it is important now, more than ever, that we innovate and stand by our customers to make sure that we navigate through these challenging times together,’ added Mr. Kioi.

A consumer sentiment survey conducted globally by J.D. Power, an American-based analytics firm on the automotive industry shows that customers are thinking pragmatically about their auto insurance options, in light of pandemic-related layoffs.