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As fuel prices rise and the world becomes more aware of the effects of climate change, the demand for electric vehicles is on the rise. Insurers can play a key role in helping their customers overcome the hurdles and opportunities associated with electric vehicles.
As I shared in my post 5 insurance industry predictions for 2022we expect the global electric vehicle market to be worth $725 billion in 2026. This is a new growth segment for innovative insurers, and not just a replacement for declining car premiums.
The shift in the insurance industry is to transform traditional loss-based products into innovative offerings that help protect the client’s interests, not just the client’s assets.
Breaking the barriers of electric vehicles
For many customers, reliable access to their home charging station is a decisive factor. Homeowners and tenants apartment buildings face many barriers to equipping a room with a charger, and regulators are starting to step in. Those who rely on street parking near their homes in urban areas are getting creative with charging solutions and likely introduction of new risks for the surrounding community in the process.
Someone will take the opportunity to provide electric vehicle drivers with charging solutions. There are many potential business models and many industries that could create affordable value propositions. Insurers, with their large amount of customer data, have a clear advantage.
We are already seeing innovations in this area, such as the Bâloise Drive Electric program. They have been recognized with Efma-Accenture Insurance Innovation Award. Through their strategic partnership, they help customers both install home charging stations and access charging stations across Europe.
Even for customers who have easy access to charging, supply chain disruptions and inflation may still delay the arrival and availability of electric vehicles. For these clients, insurers can become a strategic partner providing access to the full range of value-added mobility solutions. These may include vehicle maintenance plans to extend the life of a customer’s current vehicle, errand and delivery options, or quick access to public transportation recommendations.
Make data the driving force
Many new cars, especially electric models, are equipped with sensors and IoT capabilities that take them beyond what we think of as hardware, into the realm of technological devices. They are capable of advanced data analysis and can help the insurer and the client manage risk in real time.
When insurers consider underwriting new vehicles, they will want to take vehicle platforms into account. Whether it’s an automaker or a large technology company owning an onboard platform, insurers are a natural partner choice. A successful car purchase and underwriting can be the beginning of a long and profitable journey for a client.
Insurers with a cloud infrastructure that can support upstream and downstream data with ecosystem partners will be at an advantage. They will pave the way for more underwriting options and better claims resolution in the future.
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Disclaimer: This content is provided for general informational purposes and is not intended to be used as a substitute for consultation with our professional advisors.
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