By: Luke Jones, Published on August 8, 2018 06:51 AM, Last Update on August 8, 2018 03:53 AM
Intact Insurance says it is expanding its usage-based auto insurance (UBI) output with a soon-to-launch new solution. The company announced the product during its recent second quarter financial results.
As Canada’s largest property and casualty providers, Intact Insurance was among the first carriers to offer UBI solutions in the country, debuting its first product four years ago. Like other UBI models, Intact uses telematics monitoring to assess the level of vehicle use and driving habits to assess premium cost.
The company has also invested in US-based auto insurer Metromile Inc., which is known for settings its rates based on the distance a driver covers. Asked during the call if the company if Metromile’s model would function in Canada, Intact CEO Charles Brindamour was non-committal. However, he did suggest that Metromile’s approach is similar to Intact’s because it “very much relies on telematics.”
Intact has “a huge telematics program in Canada that is focussed on behaviour, first and foremost, whereas Metromile’s is focussed on the amount of driving you are doing,” Brindamour said.
As well as monitoring distance, Intact’s telematics monitoring also factors speed, sudden acceleration, hard braking, and other criteria to decide if a customer should receive a discount. Darren Godfrey, vice president of personal lines said Intact “will be soon launching a new iteration” but did not expand on what the product would look like.
Last month, CAA released its MyPace program in Ontario. The solution represents the first pay-as-you-go auto insurance product in Canada. Insurers will assess the base rate on the same factors as any other personal auto insurance policy. The CAA will track driving habits and vehicle usage and increase rates for every 1,000 kilometres passed.
Once the insured vehicle passes 9,000 kilometres in a year, the price will move to being in-line with regular auto insurance premium rates. The value will be for consumers who drive their vehicles less than 9,000 kilometres each year.