Amid the COVID-19 pandemic, Smartcar’s mileage verification API allows auto insurance providers to calculate premiums more accurately and assist policyholders with fairer refunds.
Auto insurance companies and their policyholders are facing unprecedented challenges due to COVID-19. Many states have ordered residents to stay at home except to perform essential activities. People across the country are driving 35% to 50% less than they used to, resulting in fewer accidents and fewer insurance claims. On top of that, more than 16 million people have filed for unemployment since mid-March. Many of them struggle to pay their bills on time.
To address these challenges, numerous insurers have announced refunds or credits towards their March, April, and/or May premiums. While these discounts provide necessary temporary relief for many vehicle owners, they are not a fair or sustainable long-term approach to the COVID-19 crisis.
By offering the same discount to all customers, insurers overcharge policyholders who are barely driving, while undercharging those who continue to drive as much as before. As the COVID-19 crisis will likely last longer than just a few more weeks, insurers need to quickly find a way to assist customers in need while accurately assessing risk.
Smartcar’s mileage verification API allows insurance providers to charge customers based on their verified mileage during the COVID-19 pandemic and beyond.
Smartcar Connect lets policyholders consent to sharing specific vehicle telemetry with an insurer’s web or mobile app. The insurer can then automatically verify the vehicle’s odometer reading using Smartcar’s automated scheduling system. Our technology communicates directly with the cellular modem that is already built into most new cars. This allows insurers to rapidly implement our product, instantly onboard policyholders, and cost-efficiently deploy the solution at scale.
When verifying each vehicle’s mileage, insurance providers are able to charge their customers more fairly and more accurately during the COVID-19 pandemic. Insurers can choose to implement a pay-per-mile approach or to offer simple monthly refunds when a policyholder doesn’t exhaust their premium’s estimated mileage.
By offering more affordable prices to policyholders who drive less, insurers are able to retain a grateful and loyal customer base, all while attracting new customers during this challenging time. Finally, Smartcar allows insurers to invest in a sustainable solution to price premiums more accurately even after COVID-19. Underreported mileage causes American auto insurers $5.4 billion in losses every year. Our mileage verification API enables insurers to accurately assess each policyholder’s risk and maximize their profits in the long-run.