“The Rise of Connectivity”
By Steve Sorenson, Executive Vice President, Product Operations
Today, consumers are ‘connected’ in every sense of the word. Just as the Internet revolutionized how we consume information, advances in mobile technology and digital media have redefined how we interact with friends, family and in the marketplace. The rise of mobile technology has given consumers greater control over their auto and home insurance through increased connectivity.
Mobile’s momentum continues to accelerate with consumers downloading more than 1.7 million applications, 65 billion times.1 Allstate has made great strides in leveraging mobile technologies to connect with our customers. Today, there’s an estimated 326 million wireless subscribers in the U.S.2 and more than half of Allstate’s customers own a smartphone,3 making mobile and digital interactivity more important than ever. Since 2012, Allstate has experienced a 67 percent increase in mobile website logins from our customer self-service center. Downloads of our mobile app increased 46 percent last quarter over the prior year, equating to more than 600,000 downloads to date. Other popular apps like Allstate Roadside, Digital Locker and Good Ride have totaled more than 125,000 downloads.4
There’s no doubt that consumers use mobile devices for the convenience and capabilities they provide. Through our mobile apps, customers can secure roadside assistance, file instant claims, view road hazards and track home valuables from anywhere at any time. Currently, about 500 customers per month are using our app to file their claims.5 Allstate’s Digital Locker application also enables customers to document their personal property in case they ever need to file a claim.
According to our research, the main reason consumers utilize usage-based auto devices and provide their driving data is to earn discounts or lower fees by demonstrating safe driving behavior.6 While many consumers value the opportunity to earn discounts through telematics, some express concern about the appropriate use of their data. According to a study from A.T. Kearney, to “overcome this hurdle, insurers must be as transparent as possible up front, offer the right amount of value-added services to customers and carefully position the offerings with the right messages to win over consumers.”7
At Allstate, the 70 percent of Drivewise users that earned a discount received a 14 percent average discount on their premium.8 This month, Allstate will celebrate an important milestone: one billion miles driven and recorded through our active Drivewise devices.
SAFETY & PREVENTION
Insurers help customers recover from unexpected losses, but we can also help to prevent losses from occurring in the first place. Telematics and usage-based insurance devices have the potential to transform the auto insurance industry and create safer roads. For example, data collected from Drivewise helps drivers learn how they can improve their driving and offers parents a tool to monitor their teen’s driving habits.
The multitudes of mobile applications are paving the way for consumers to be more proactive in preventing losses. Whether tracking or maintaining the home or informing a consumer on how to use safer practices, insurers are demonstrating what can really make a difference when difficult times, like catastrophes or fires, challenge our way of everyday life.
‘Connected’ insurance will increasingly provide consumers with greater convenience, savings and safety.
The market for usage-based insurance continues to grow, with more than one out of every two consumers indicating they will opt for usage-based insurance with their next car.9 Widespread adoption has the potential to promote safer driving habits, streamline the claims filing process and lower rates for safe drivers. With Drivewise rolling out in more states this year, I’m excited that Allstate will continue to be at the forefront of making our roads safer.
While connectivity is expected to improve safety on our roads, it will also help improve the safety of our homes. At the 2013 Consumer Electronics Show in Las Vegas, leading consumer products companies unveiled multiple “smart” home appliances that provide real-time monitoring and control through mobile applications. These appliances have the potential to play a transformative role in safeguarding homes through security, utilities and environment, and infrastructure monitoring. According to a recent study, more than 90 million smart home devices will ship worldwide by 2017.10
Connectivity is a game changer for our business and our customers. By continuing to innovate and reimagine insurance products and services with consumer connectivity in mind, we can bring enhanced convenience and savings to customers, while helping make their lives safer, ensuring they are always in Good Hands.
2 http://www.ctia.org/consumer_info/service/index.cfm/AID/10323, December 2012
3 Forrester Technographics, Q2, 2012
4 Allstate, Q2, 2013
5 Allstate, Q2, 2013
6 Celent Research, 2013
7 “Telematics: The Game Changer,” A.T. Kearney – September 2010
8 Allstate, Drivewise, July 2013
9 Gartner Research, 2012