I spoke to Anton Ossip, CEO, Discovery Insure, to find out how they are using Telematics to ensure clients are assisted during the pandemic.
Anton started off by saying that it was business as usual for them. They moved fast, moving all staff home with laptops and desktops and experiencing no offline time during the move.
He recalled how they started telematics nine years ago and have learned a lot over this time. Using Telematics and their experience gained over these years, their COVID-19 response is the latest innovation to their motor policies. According to Anton they realized that most people did not drive or drove very little in April. That made it easy to calculate a standard discount. However, as we go down levels, every driver will be different, which makes Telematic monitoring critical. It tells who is driving, who not and how much they drive. The less people drive, the lower their risks are for having accidents. Clients’ lowered risk also meant a reduction in the loss ratio.
Dynamic Distance cash back is a direct outflow from Discovery’s Shared Value model, underpinned by technology, through which we turn what we save in losses into client rewards.
As Anton said “Our clients can now earn 25% motor premium cash back every month, when they drive between 0km and 249km, or 15% cash back if they drive between 250km and 499 km. They can still earn up to 50% fuel cash back when they drive more.
“So, whether our Vitality Drive clients drive more and spend more on fuel or drive less and spend less on fuel, they can all still earn cash back for good driving behaviour through a combination of our usual Vitality Drive fuel cash back and our newly introduced Dynamic Distance cash back.”
Benefitting from controllable driving – With this development Discovery redesigned Vitality Drive to be even more rewarding and personalised. Points which can be accrued for good driving behaviour in the Vitality Drive programme have been increased. “To date, drivers could earn up to 550 points for their daily controllable driving behaviours including acceleration, braking, cornering, speeding and cell phone use. Now, clients have the opportunity to accumulate up to 750 Vitality Drive points in a month for these controllable behaviours,” said Anton.
Each day Vitality Drive clients will be allocated 25 Drive points. Based on the behavioural economics principle of loss aversion, as a means of encouraging improved engagement, clients will need to maintain good driving behaviour throughout the day as poor driving behaviour will result in points being deducted.
According to Anton, at the end of each day, the remaining Drive points are banked towards the client’s weekly Active Rewards drive ring to help them reach their weekly goal. This daily Drive points balance also adds towards the client’s monthly Driving Profile (up to 750 points), which contributes to the client’s total monthly Vitality Drive points. This score is used to calculate their fuel cash back (of up to R800) every month.
Explained Anton, “We have also enhanced our weekly Active Rewards drive goal to give clients a more personalised experience. This means the Active Rewards drive goal each week is based on a client’s driving behaviour and not on the number of kilometres they have driven as it previously did. With this new structure, the more consistent a person drives, the more points they can bank. When their weekly goals are achieved, Vitality Drive clients will instantly earn 100 Discovery Miles and a play on the game board to reveal additional Discovery Miles”.
Further value to older clients – Older adults also stand to benefit from the Vitality Drive programme more. Adults between the ages of 65 and 80, can earn up to 50% motor premium PayBacks every year. Driving well and less than 10,000km a year, combined with completing an annual Vitality Health Check for 65+ will help them qualify to save up to 50% of their premiums during retirement. They will also have access to Vitality Active Rewards, Vitality status-based rewards and up to 50% cash back on fuel making their insurance truly affordable.
As Anton said, “Vehicle insurance doesn’t typically cover things like mechanical breakdowns or electrical failure”. A warranty plan normally provides this cover when a new vehicle is purchased. Standard warranty plans provide cover for around four years or up to 48 000km. However, most South Africans now keep their vehicles for longer and this is expected to increase under the current economic downturn.
Since cars are being kept longer, there is a greater need for electrical and mechanical maintenance with a higher proportion of cars not covered under warranty as the manufacturer warranty has expired. “With our new benefit, we’ll be offering our clients a first-of-its- kind telematics-based warranty cover that offers one solution to meet a vehicle owner’s actual needs,” said Anton.
Discovery Insure introduced its brand new warranty product to offer market-leading, unlimited mechanical breakdown and electrical failure cover for 36 critical vehicle components. This is done by using the sophistication of their risk-rated premium structure to ensure that clients pay a premium appropriate to their risk.
“We saw an opportunity to provide a warranty solution that meets the true needs of the current market. This way we provide cover that can help to avoid unaffordable and unexpected costs,” explained Anton.
Using expertise from Discovery’s Vitality Drive programme, they extended the driver-behaviour programme to the warranty market to offer the first telematics-based warranty cover. Vitality Drive clients can earn up to 100% off their yearly servicing and maintenance costs for driving well.
“We’re proud to be able to offer all our clients enhanced value that can quickly adapt to the times and to changing needs. We’ll continue to make use of innovative technology for this purpose,” he said.
Anton concluded the conversation by saying that telematics is the cornerstone of their business with the core purpose being the making of better drivers. They are spending a huge amount of time on technology, making it more intuitive for people to be able to easily benefit and know how they can benefit.