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Insurer uses tech solution to offer premium relief for customers

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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.

 

Data collected by Heritage Insurance through the telematics devices fitted in vehicles on its Auto Correct motor insurance policy shows that 46 per cent 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.   

 

Given the reduced exposure, Heritage Insurance is offering a cashback to all Auto Correct policy holders, based on each individual’s level of reduced driving in April 2020 compared to their normal driving range.

 

Godfrey Kioi, Heritage Insurance Kenya’s Managing Director, said: “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 behaviour and most importantly, cushion our clients in these tough economic times.”

 

The Managing Director of one of the leading insurance brokers, H.G Thanawalla Insurance Brokers Limited, Mr. Taj Thanawalla, who was present at the launch of this offer, 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.”

He lauded insurance companies providing relief to customers in recognition of reduced driving, noting that the relief was different for each customer, demonstrating how data can help insurance companies treat customers as individuals.

 

The use of telematics technology has enabled Heritage Insurance to calculate premiums more accurately. Heritage also uses telematics technology to encourage better driving behaviour through a loyalty programme where drivers earn points that can be redeemed at various outlets.

 

To this end, the company has also announced a 7.5 percent discount on the annual motor vehicle premium for customers converting to Auto Correct during the months of May, June and July. The Auto Correct Rewards Programme, a points-based loyalty programme 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 Auto Correct is the first telematics-based insurance product in Kenya and exemplifies innovation in the sector.

 

Further, the insurer has also moved to reduce the monthly cost of their motor vehicle premiums by 15 per cent for motorists on the motor cover, for the months of May and June 2020.

 

The Heritage Insurance MD, Mr. Kioi said the relief will only apply to private cars, for individual customers, insured on a comprehensive basis. “In the event that a customer already renewed their policies prior to the month of May, the discount will be applied against the renewal premium for the following year.”

 

“At Heritage Insurance, we recognise 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 firms on the automotive industry shows that customers are thinking pragmatically about their auto insurance options, in light of pandemic-related layoffs.

 

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