The insurance industry continues to be a hotbed of patent innovation. Activity is driven by digitalization, personalization, and growing importance of technologies such as artificial intelligence (AI), Internet of Things, and cybersecurity in insurance documentation and data analytics, predictive risk assessment, fraud detection, and smart policy management. In the last three years alone, there have been over 17,000 patents filed and granted in the insurance industry, according to GlobalData’s report on Innovation in insurance: vehicle usage based premiums. Buy the report here.
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According to GlobalData’s Technology Foresights, which uses over 70,000 patents to analyze innovation intensity for the insurance industry, there are 20+ innovation areas that will shape the future of the industry.
Vehicle usage-based premiums is a key innovation area in insurance
Vehicle usage-based premiums refer to an insurance pricing model that determines insurance premiums based on the actual usage of a vehicle. It involves the use of vehicle tracking apps and telematics devices to collect and analyze data on vehicle operation, such as distance traveled, driving behavior, and other factors, and assess the risk profile of the insured vehicle and calculate the insurance premium accordingly. This approach offers a more personalized and fairer pricing structure compared to traditional fixed premiums based on factors such as age and location.
GlobalData’s analysis also uncovers the companies at the forefront of each innovation area and assesses the potential reach and impact of their patenting activity across different applications and geographies. According to GlobalData, there are 100+ companies, spanning technology vendors, established insurance companies, and up-and-coming start-ups engaged in the development and application of vehicle usage-based premiums.
Key players in vehicle usage-based premiums – a disruptive innovation in the insurance industry
‘Application diversity’ measures the number of applications identified for each patent. It broadly splits companies into either ‘niche’ or ‘diversified’ innovators.
‘Geographic reach’ refers to the number of countries each patent is registered in. It reflects the breadth of geographic application intended, ranging from ‘global’ to ‘local’.
Patent volumes related to vehicle usage-based premiums
Source: GlobalData Patent Analytics
Among the companies innovating in vehicle usage-based premiums, State Farm Mutual Automobile Insurance is one of the leading patent filers. The auto insurer gives its customers the option of usage-based insurance (UBI) as part of the Drive Safe & Save telematics program to monitor and measure driving factors such as speeding, acceleration, braking, and the miles driven. Participating customers can avail cheaper car insurance rates depending on their driving score and how often and how far they drive their vehicles.
Allstate, Cox Enterprises, and Flex are some of the other key patent filers in the vehicle usage-based premium space.
In terms of application diversity, OPTIMUM held the top position, while Advanced New Technologies and Cox Enterprises stood in second and third positions, respectively. By means of geographic reach, Flex leads the pack, followed by Allianz and Discovery.
To further understand the key themes and technologies disrupting the insurance industry, access GlobalData’s latest thematic research report on Insurance.
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GlobalData, the leading provider of industry intelligence, provided the underlying data, research, and analysis used to produce this article.
GlobalData’s Patent Analytics tracks patent filings and grants from official offices around the world. Textual analysis and official patent classifications are used to group patents into key thematic areas and link them to specific companies across the world’s largest industries.
