Wejo Group has entered into an agreement with Ford Motor Co. to use Ford’s connected vehicle data to inform auto insurer rates and policies in the United States. The companies first rolled out the program in Europe in June.
Wejo, based in Manchester, England, said its data-based vehicle insurance program is designed to “better understand driving behavior,” in the US Ford said it would only provide the data with the consent of its customers.
“This data can help the auto insurance industry better validate customer-provided details, identify and mitigate insurance fraud, offer more accurate dynamic pricing models, and reduce risk for safer rides and less stress for policymakers and customers,” said Ford and Wejo together press release.
The agreement comes as the auto and insurance industry continues to understand and leverage data-based driver and vehicle information points to set auto insurance pricing guidelines.
The overall practice of collecting these information points is often referred to as telematics. The practice follows certain driving behavior, such. E.g. kilometers traveled and braking habits, using a plug-in device, a smartphone application or, as in this case, data collected directly from the vehicle.
Wejo’s software and hardware solutions track how a person – or an autonomous vehicle – drives by collecting numerous pieces of information and then standardizing and enhancing these data streams at scale.
Wejo did not say when the US program will be launched.
In a statement, Wejo founder and CEO Richard Barlow said the partnership with Ford will “enable mutual benefits for both policyholders and insurers as auto insurance companies embrace connected vehicle data forever.”
Barlow said the deal is part of “reinventing” auto insurance for a “smarter, safer” future for the industry.
News of the agreement comes as a new study by the Insurance Research Council shows consumers are reluctant to take out UBI because of privacy concerns.
According to a study commissioned by the Insurance Research Council, an independent nonprofit research organization supported by leading insurance companies and associations, privacy concerns exist with initiatives like Wejo’s.
The results of an IRC survey of over 2,000 US drivers, released late last month, showed that “many drivers choose not to participate in telematics programs,” although the report did not specify how many drivers would choose not to participate if they would be asked.
The survey found that about 80% of those who participated in a telematics program said the program helped change the way they drive.
The report revealed that part of the reason drivers might be concerned about such programs is that they might not understand how they work.
It is also well known that US consumers have become wary of privacy concerns in recent years as technological advances have continued in many areas of consumer behavior.
In a statement, Dale Porfilio, President of the IRC, said more drivers than ever are participating in telematics programs.
“Some consumers we interviewed were reluctant to sign up because of privacy concerns,” Portilio said. “Younger drivers were less likely to raise privacy concerns. The same group also showed the greatest interest in finding ways to lower their premium.”
While the privacy issues will continue to resonate with some, proponents of telematics programs could see opportunities to bring the security aspect home.
A recent article in the New York Times highlighted how driver safety in the US has deteriorated in recent years.
According to the story, which cites federal data, U.S. road fatalities have been rising oddly over the past decade, a trend at odds with what’s seen in other developed countries.
In 2020, when car and truck traffic fell sharply due to the pandemic, the number of road fatalities in the US actually rose
“Telematics programs provide the opportunity for safer driving to reduce their insurance costs and can improve overall road safety,” Porfilio said. “Most users state that they have positively changed the way they drive because of the telematics data provided to them by their insurer. Safer driving reduces the frequency and severity of car accidents, saves lives and enables more affordable vehicle insurance for all consumers.”
Wejo and Ford join forces to expand end-to-end insurance offerings in the United States
IRC study reveals driver telematics programs face privacy concerns
Click here to access IRC%20Telematics%20Survey%20Report%202022%20News%20Release.pdf
Featured image provided by Ford