Qualcomm: “Telematics is the new roadmap for insurance companies”

Qualcomm: “Telematics is the new roadmap for insurance companies”

What does your company do?

Since 1988, Qualcomm Enterprise Services has provided integrated telematics systems and services to commercial fleet companies around the world. With more than 1.3 million mobile units shipped to businesses in 39 countries on four continents, Qualcomm delivers the business insight these companies need in order to operate at peak performance and provide superior customer service. Backed by a global, 24/7, world-class technology infrastructure, Qualcomm is positioned to meet and exceed the increasingly complex and business-critical needs of its more than 2,500 clients with superior customer care and professional services.

What is your role in the insurance telematics market?

Qualcomm Enterprise Service has launched various end-to-end insurance telematics solutions dedicated to the consumer and commercial vehicle segments, including telematics hardware units, communication infrastructure, Web service platforms, and mission-critical services such as installation, maintenance, billing, and system integration Qualcomm already collaborates with leading insurances such as Zurich and is involved in a number of trials so that insurance can validate its business case leveraging the superior quality and reliability of Qualcomm solutions.

How important is telematics throughout the insurance space?

Telematics is the new roadmap for insurance companies to adjust the car policy premium with the actual risk profile of drivers so that they can offer more dynamic and segmented pricing schemes and differentiate from competition while satisfying their bottom-line requirements. Telematics also opens the door to connected services such as anti-theft and eCall to improve both insurance ARPU and customer retention programs. Finally, telematics services provide benefits in terms of business automation by reducing the number of manual processes and paperwork or call center administration tasks while at the same time increasing the accuracy and reliability of driver risk profile and statistics.

What is needed for the large-scale success of PAYD/usage-based insurance?

Telematics technology is now mature enough and collaboration among system vendors, mobile operators, and telematics service providers is already well proven. Qualcomm has been working with an ecosystem of partners for 20 years and has been demonstrating its solution benefits to the customers in various vehicle markets. However, the business case for insurance telematics solutions still needs further validation and predominant success factors will be the open collaboration among all value chain players—telematics service providers, insurance companies, installation networks, and governments. This is necessary in order to find the most suitable business model to minimize operational cost, maximize safety on the road while satisfying end-user needs for value-added services as well as data privacy. Create win-win situations all the way is the only path for success.

Which trends will impact the industry the most in the coming years and why?

The eCall mandate set forth by the European Commission requiring car OEMs to equip all new vehicles with connectivity platforms in the coming years will significantly impact the car insurance market. The eCall initiative will lower entry barriers for providing telematics services directly to end-users. In order to lower the total cost of ownership of an in-car connectivity platform, car OEMs will be interested in developing open hardware platforms that can leverage the different consumer and commercial telematics services already in use on the market in order to achieve faster ROI.

How do you view the role of auto OEMs in the insurance telematics arena?

The eCall strategy can also strengthen the positioning of car OEMs in this value chain and enable them to improve their customer relationship and retention programs. If they are successful in their strategies, they can become the primary interface to drivers to offer any car-related services. It can even represent a threat to insurance companies if the latter don’t move fast enough in offering insurance telematics programs.

Where do you see the insurance telematics industry heading in the next five years?

Five years from now, the market will be more mature, the business case will be proven, strategic partnerships among TSPs, insurance, and dealers will be in place, and regulations will act as a driver and not as an inhibitor. Usage-based insurance telematics programs will be one of the standards in car insurance policy and will attract a portion of the European market on the consumer side. On the commercial side, such innovative insurance programs will even be more successful and reach a larger part of the market due to the lower cost and confidentiality constraints.

For all the latest on insurance telematics, join the sector’s other key players at Insurance Telematics Europe 2011 on May 4-5 in London.

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