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Bringing insurance telematics to commercial auto

Solving fleet managers and insurers' challenges through use of data
Christoph Kappler
Chief Operating Officer

Germany's commercial auto market

Today, the German commercial auto market has a strong and stable leading position in the EU with around 3.4 million commercial vehicles on the road and a yearly growth rate of 3-4 %, based on data provided by the German Federal Motor Transport Authority (Kraftfahrtbundesamt). Looking at current use cases from fleet owners and at market trends, the focus areas are efficiency increase, cost reduction, ecological footprint improvement, and risk lowering through remote diagnostics and predictive maintenance. Using data ethically and in the right way is giving market participants a competitive advantage. It was a natural place for Movingdots, as one of the pioneers in the German telematics industry, to compete in this arena.  

Through telematics, insurers have been able to innovate in the personal auto segment. However, there are also benefits in the commercial auto space, which insurance companies are starting to explore. The combination of telematics and fleet management capabilities provides unique insights for businesses, increases efficiency and profitability for fleet owners and improves safety for drivers and all other road users.

The beginning of our journey into fleet telematics

Movingdots was founded in 1999 as a SME in the IT field, with a focus on the German transport and logistics market. The goal of the company was to optimise processes with software. Movingdots' long journey and experience in building fleet telematics software was initially driven by one of its largest clients in Bremen, an international seaport and logistics company with around 11 000 employees.

In these early stages, clients’ needs in the commercial fleet industry were much different than today. They needed to locate and track their vehicles and generate ex ante reporting on driven routes, for example. Since then, clients’ expectations have evolved and we have been improving our offering accordingly, working in numerous industries, adding to logistics construction, couriers and bus companies, taxi services, emergency vehicles and other technical service providers.

The app that makes you a smooth driver

Drivers have certain things in mind whilst on the road, no matter what their driving skills are and if they simply commute, drive their children to school, or if they drive for a living. The biggest concern is of course safety, with distracted driving being one of the biggest road traffic risks these days. Smooth driving is key and brings with it substantial benefits for the driver, the vehicle and other involved parties.

Coloride Dashboard

In 2015, Swiss Re acquired Movingdots and developed the existing experience in insurance telematics for primary insurers into the new core business of the company with an international focus. Over the past five years, together with our Swiss Re colleagues, we have successfully developed and introduced the telematics app Coloride in several markets worldwide. Coloride uses a background process to automatically record driving data and recognise different modes of transport, such as trains, trams, planes, buses, bikes and more. By collecting sensor data from drivers' smartphones, Coloride calculates a driver score based on four components: distraction, speeding, maneuvers and context. The app can significantly impact safety on the roads thanks to its coaching features for drivers. In this way, risk is prevented rather than transferred to third parties, resulting in lower costs, decreased fuel consumption (and therefore emissions) and value-added experiences for both primary insurers and end users.  

Why working with Movingdots?

The insurance market lacks technical tools to properly underwrite risks for different types of commercial fleets. This makes it challenging for insurers to define and manage risks with one-size-fits-all offerings, leading to a significantly larger risk pool with higher premiums per vehicle. The segment is generally low profitable for insurers. This is mainly due to the high variability of risk conditions, uncertain liability regimes and increasing claims costs. Fleet owners, which are often large insurance buyers and price sensitive, tend to change insurer when their premiums increase and, usually as a result of this, if they feel they do not have a good customer experience. For instance, in the American Transportation Research Institute’s 2020 survey of the top issues facing trucking in the US -being the largest economy in the world- insurance availability and cost ranks fifth. Rising insurance costs and availability, especially for smaller fleets, have been citied as a reason for some fleets going out of business.

The solution stands with data. With know-how on both personal auto telematics, through Coloride, and commercial fleets telematics, Movingdots is now combining both to support insurers and fleet owners in their underwriting journey through commercial auto risks, knowing that the hurdles they are facing can be overcome through smart usage of data.

A valuable combination

To solve the problems faced by incumbent insurers and to make their fleet customers happy, we are working on a clever combination of fleet and insurance telematics for better scoring capabilities. Insurers will have a solid score available for more accurate and proactive management of risk through driver coaching, better pricing capabilities through driving data, reduced claims frequency, access to accident data to resolve claims more efficiently, and ultimately the ability to increase profitability of the motor insurance book. Fleet owners and operators will find Movingdots' telematics solutions useful to encourage safer driving habits (which will positively impact the cost of ownership due to lower maintenance needs, fewer accidents, less downtime, lower fuel usage, etc.) and to obtain fairer insurance rates from insurers adopting Movingdots score. We can support clients with existing fleet management solutions, looking to add insurance scoring to it, but also provide one package with both an insurance score and fleet management telematics software.

Did we spark your interest? Then, get in touch with us!

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