4 tendencies that may remodel motor insurance in 2022 and past – Girls on Wheels

Auto insurance is changing as digital innovation and the pandemic transform the way we live, work and drive. Thanks to digital technology, you benefit from better prices, more transparency and more convenience in your insurance experience. And things will only get better as new digital innovations hit the market.

Ernest North, co-founder of digital insurance platform shared some of the trends we can expect to see in auto insurance in the coming year:

New ideas about owning cars and getting around

After the harsh lockdown of 2020, many of us have been forced to work from home. It has worked so well that many companies and people are not planning to return to the office full-time. Because of this, many families wonder if they really need two cars in the driveway. After all, gas prices are rising, money is tight, and Uber offers a cheap and reliable way to get around if you don't have a daily commute.

Now that we're not driving around as much as we were before the pandemic, it's a good time to reconsider car ownership. More and more people are downsizing their second car to a smaller and less expensive vehicle, putting off replacing their car, or even selling one of their cars because they no longer drive as much. And if you don't want to give up your second vehicle, you should take out an insurance policy that will allow you to pay less when you don't drive much.

Buying a car and everything that goes with it online

According to World Wide Worx, South African e-commerce retail sales totaled R30.2 billion in 2020 – more than double the R14.1 billion achieved in 2018. The explosive growth is largely thanks to Covid and social distancing, as well as accelerated investment in the technology that enables e-commerce. Now that people are more comfortable shopping for groceries online, they are also more interested in buying bigger things like cars and insurance through a website or app.

We can expect exciting developments in online car trading in South Africa over the next year or two. We can see that online dealers and marketplaces make it easy for you to compare financing offers, vehicles and insurance and then get everything in one place. In the future, you could complete a car purchase online, from researching the options and applying for a loan to ordering the car and getting insurance coverage.

Perhaps you buy cars by reading reviews and watching ultra high definition videos, and only book a test drive once you've decided on a car and want to confirm your decision. This has the potential to put you in complete control of your experience – car dealers, lenders and insurers all need to up their game in terms of pricing, convenience and transparency to win your business.

Smarter Cars

Today's modern cars, particularly the high-end electric vehicles from BMW and Tesla, resemble smartphones just as much as traditional cars. They're internet-connected devices that use artificial intelligence, advanced sensors, and other cool technologies to do amazing things. Even in South Africa, where the transition to electric vehicles is slow, more and more cars with connected functions are coming onto the market.

These features include advanced driver assistance systems (ADAS) and infotainment offerings – for example emergency call systems, diagnostic data and using a smartphone app to lock, unlock or locate your car. This represents a dramatic leap in performance over the telematics boxes some insurers use to analyze your driving behavior and adjust your insurance premiums if you brake too hard or drive too fast.

A connected car could generate richer data that insurers could use to adjust premiums and policies in real time based on where, how well, and how far you drive. Related to connected cars is the slow evolution toward self-driving (or autonomous) cars. While truly autonomous cars are still a long way off in South Africa, we can expect wider acceptance of semi-autonomous cars that can accelerate, decelerate and stop without human intervention

Examples of these ADAS functions are self-parking, adaptive cruise control and collision avoidance systems. In the long term, these features could help lower insurance claims and premiums by reducing human error on the roads.

Digital insurance is going mainstream

While insurance previously lagged behind many other industries when it came to giving consumers access to convenient digital processes, in the last year or two online-only insurance offerings have seen mass adoption around the world. South Africa was no exception, with Naked Insurance posting record growth.

As digital insurance providers use automation and self-service to reduce overhead and operate efficiently, the result is significant cost savings that translate to sustained lower premiums

As more and more customers buy, claim and manage their insurance coverage online, we can expect continued innovation to lead the way in lowering premiums. Perhaps even more exciting than the cost savings is the way digital insurance puts you in control and eliminates the hassle of insuring your car.

Image: Women On Wheels Gallery

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