Auto insurers can go beyond products that reward safe driving by using data from existing smartphones and machine learning, TrueMotion CEO Ted Gramer said.
Speaking Thursday at the Connected Car Insurance USA conference in Chicago, he said such information will help companies improve their claims process and deal with industry pressures such as distracted driving, autonomous vehicles and ride-sharing.
“There’s a big opportunity to really build the next-generation insurance products that should compete with new entrants and newer consumer needs,” Gramer said. “This is the journey that can get carriers to that next level.”
He noted that connected cars, which have Internet access, are promising but won’t have a meaningful impact for more than a decade. One of his slides predicted 48% of the cars on the road in 2025 will have that capability, with 58% by 2030.
A more immediate solution, Gramer said, is to use data from existing smartphones and eventually transition to information from connected cars and other devices. He noted smartphones already have a lot of sensors built into them, including accelerometers, gyroscopes and magnetometers, that are in connected cars.
For example, Gramer said his company’s app can detect when a car is moving with 99% accuracy and can determine if someone is the driver or passenger about 92% to 93% of the time. In the latter case, he said, a driver would get out of the car counterclockwise, while a passenger would rotate clockwise.
TrueMotion uses those and various other small signals from a car, such as those from windshield wipers, pulls them into the “cloud,” and then runs them through a machine learning platform, he explained. It looks for patterns. Buses, for example, have different patterns than a car.
“We take those signals, turn them into insights and stream them to insurance companies, rideshare companies to produce scores, pricing variables, crash ID,” he said.
Gramer said smartphone data can be used in the “first notice of loss,” or FNOL. He noted claims are one of the largest expenses for auto insurance companies and still mostly involves manual information gathering.
“About 25 percent to 50 percent of the fields that you be filling in for the FNOL can be prepopulated with data coming out of the phone,” Gramer estimated. He added customer-provided photos from an accident scene also can streamline the process of appraisals, investigation, negotiation and payments.
“When you think about the potential impact on loss control and expenses, this is one of the big, maybe one of the only big…improvements that is going to happen in the cost structure of the claims operations, he added.
Insurers should be developing the “muscle” now to deal with the type of data that will increasingly be available in a standardized form, Gramer said. Possibilities include a full-integrated app with pricing, customer loyalty programs, accident scene services and more.
“It’s not going to happen overnight but it’s pretty exciting opportunity to see how data can enable that next generation of insurance,” he said.
Gramer joined Boston-based True Motion last year. He spent more than a decade with Liberty Mutual Insurance as an executive including Chief Claims Officer and Executive Vice President of Liberty International.
True Motion, founded in 2012 as Censio, currently works with five of the top 10 insurance carriers in the U.S. and also operates in Canada and Europe. It is backed by General Catalyst Partners and Bain Capital Ventures.