Personal auto is going through a very important disruption in its business model. The clear differentiation in the customer segments is being driver by technology and cross industry developments. Automobile manufacturers are on the journey to driverless cars. The innovations in the automobile industry have changed the playing field for the insurers. Traditionally, insurers were offering auto insurance products based on the vehicles and the driver information. It evolved to include the “Pay As You Drive (PAYD)” model. PAYD offered a differentiated value to the policy holders where premium was paid including the distance driven instead of the traditional underwriting. Vehicle advances have pushed insurers to evolve the PAYD model. Telecom companies have joined hands with the automobile manufacturers in making vehicle diagnostics available on mobile or OBD devices. This has made “Pay How You Drive (PHYD) possible. Insurance premium is calculated in the driver’s way of driving such as applying brakes, acceleration, driving speed, terrain, hours of driving, etc in addition to the distance and traditional vehicle characteristics and driver demographics.
Virtusa’s rich expertise in the insurance industry and deep focus in the areas of mobility and analytics has uniquely placed Virtusa as a unique enabler to help insurers adopt usage based insurance and offer competitive products to their policy holders.