Insuring e-Scooter Mobility Hampered by Data
In Russia, the boom of e-scooter use in 2020 and 2021 resulted in an eight-fold overall growth of scooter-related traffic accidents.
Public concerns are heightened from knowing that only a fraction of scooter riders own liability insurance, an issue observed in many countries globally. For example, recently, Australian website The Riotact suggested that compulsory insurance should be attached to each e-scooter whether a hired of privately owned one. In this regard, European road users can only welcome Bolt’s decision to embed insurance in scooter rental fees across EU in partnership with Allianz, announced last December.
In Russia, only 0.5% trips were insured in the last year, according to insurance company Soglasie. Insurance of all types is voluntarily and, as far as e-scooters are concerned, quite costly. A 50₵ pay-per-trip fee, common for the major scooter rent providers, can look like no big deal. However, if riding daily to work, it translates into around 5% of the country’s median salary, a strong reason for many to neglect insurance.
In this situation, implementation of smart AI-based insurance plans could give a boost to the consumer uptake and improve overall safety, thinks Neil Featonby, vice-president of business development and marketing at Simble Europe. “We believe that, by using telemetry data, it would be possible to use PAYD/PHYD models to reward correct ride behavior at a very little cost to operators and insurers,” he said. “It’s a win for both and, in particular, for consumers.”
A number of safety studies, conducted in the country in 2021, support this sentiment by concluding that strong regularities exist in scooter-related accidents. There’s a seasonal spike in June and also a weekly cycle as well with two maximums on Mondays and Fridays. Although the most accidents happen in the daytime and good weather, rain and darkness drastically increase severity of consequences. These findings open the door for adjustable tariffs and discounts that account for individual behavior as well as time-of-day, weekly and seasonal cycles, traffic and weather conditions and geo-dependent factors. Effectively, some market players do run such schemes to cars, so, adapting them to e-scooters wouldn’t come at a cost.
However, in scooters, the insurers have issues collecting the quality data necessary for the development of smart solutions. “Although such sophisticated products can emerge in future, the current conditions are inappropriate for this because we lack real-time knowing of the rider’s route and riding style,” said Aleksei Alekseev, managing director of partner sales channel at Renaissance Insurance. Partly, this is because the market is still at a nascent stage with only one e-scooter per each 100 cars presently on streets. Facing high risks of a possible poor uptake and incorrect forecasts on threats, sales and claims, the companies are focusing on simple pay-per-trip insurance plans, he said.
The deficit of data is especially acute in the instances of privately owned vehicles and accidents that involve no suffering third party. However, the safety studies’ conclusion is that these vehicles are less safe than hired ones because they are, generally, more powerful and speedy than rented scooters while they lack safety telematics to enforce regulation compliance. “Private scooters need a wider liability coverage,” said Stanislav Pushevskiy, CEO at Simble Russia. “However, implementing new pricing approaches is hindered by a lack of statistical data on losses.” In one instance, the Simble had no opportunity other than founding its e-scooter insurance plan on open-source data and launching it with a small safety margin embedded in the fee.
Featonby thinks that smart solutions can be especially successful in rented scooters owing to the synergy of the digital competencies of insurers and scooter rent companies. For instance, an insurer could benefit from the provider’s automatic reporting about a trip’s start and end. At the same time, a provider could use the insurers’ AI tools for real-time detection of instances of speaking on the phone when riding or erratic behavior in drunk or drug-abusing riders and immobilize the scooter to prevent possible damage. However, for this, seamless data exchange between the two must be established: “In order to apply these scenarios to scooters, we’re working closely with operators to identify the variances in core telemetry data characteristics.”
The authorities’ efforts towards forming an environment favorable to scooters also have a part in the future success of smart insurance schemes, said Pushevskiy. Currently, a lack of regulation and infrastructure favorable to scooters impedes the insurers’ ability to fully embrace telematics and AI for development of more convenient products. “However, the situation is changing for the better and it certainly will in the future,” he said.
