Last week, regulator IRDAI allowed general insurance companies to introduce a new motor insurance product which will have tech-enabled ‘Pay As You Drive’ and ‘Pay How You Drive Features’
Industry experts believe that insurtech companies will play a key role in rationalising the product and recognising risk patterns of drivers
Electric vehicles will give a boost to the new product as it will require telematics data, the device which is often inbuilt in EVs
Insurtech companies will play a key role in the new motor insurance product which will have tech-enabled ‘Pay As You Drive’ and ‘Pay How You Drive’ features as add-ons to own-damage cover.“Over time, these approaches will help reward drivers who demonstrate lower risk behaviour through lower insurance premiums, while penalising higher risk behaviour patterns,” he added. Sambit Chakraborty, who is on the Board of Advisors of Indigrid Technology, which assembles battery packs for electric two-wheelers and three-wheelers, concurred with Mukherji. “The chances of this being a hit, being taken up are much higher. I don’t think it will really take off in conventional vehicles, in combustion engines. But in EVs, there is a very good possibility that this could be a positive value add,” Chakraborty, who is also a consultant with Prudent Insurance Brokers, told Inc42.“For a single policy for multiple vehicles, an account management will best be defined using technology,” said Tejuja.
The increasing adoption of electric vehicles (EVs) is also expected to bolster demand for this new motor insurance product.