The insurance industry is witnessing a transformation through the integration of big data and technology. While this shift initially took place in the consumer market, it is gradually becoming a reality in the commercial sector as well. Commercial fleet operators now have the opportunity to utilize their own fleet data to showcase their risk profile and improvements to insurers. By doing so, they can effectively combat the rise in auto premiums and secure better insurance rates. In this article, we explore how commercial fleet operators can leverage their fleet data to demonstrate that they pose a lower risk.
Despite ongoing changes, traditional insurance methods continue to dominate the commercial fleet insurance landscape. The calculation of insurance premiums is typically based on factors such as the sector of operation, fleet size, prior claims history, operating times, and geographical coverage. While this approach has been widely accepted, it fails to provide an accurate indicator of an operator's specific risk. Instead, it relies on historical averages derived from a diverse range of commercial fleets, disregarding the unique circumstances of individual fleets. Furthermore, operators may still find themselves paying for past issues that have since been addressed and successfully mitigated across their driver population.
To initiate a more informed discussion with insurers and negotiate better premiums, commercial fleet operators can adopt a new model that leverages their fleet data effectively. Here's how:
This approach may be unfamiliar to insurers or brokers, making it an opportune time for operators to challenge them. By utilizing their fleet data to support their case, operators can initiate a shift in the discussion and advocate for better insurance rates. Engaging in this process not only presents operators with nothing to lose but also highlights the additional value derived from their investments in fleet risk management, data collection, and utilization.
Commercial fleet operators have the ability to leverage their fleet data to demonstrate their lower insurance risk profile. By embracing this new approach and engaging in discussions with insurers, operators can proactively combat rising premiums and secure better rates. This shift towards data-driven decision-making in the insurance industry offers operators the opportunity to showcase their efforts in fleet risk management and their commitment to utilizing data effectively. Embracing change and adopting a data-centric approach can lead to tangible benefits for commercial fleet operators in the insurance market.
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