Texas Farm Bureau launches UBI with Arity
Texas Farm Bureau Insurance has launched a usage-based insurance program, Drive’n Save, in partnership with Allstate’s Arity. The program went live at the end of March.
Minesh Patel, director of pricing for Texas Farm Bureau Insurance, told Digital Insurance that modernizing pricing is a part of his role at the insurer. That strategy included getting a telematics program going.
“Telematics is obviously a growing field … you need it to help compete in the marketplace and get more sophisticated with your rating. Nothing is going to be more predictive than your actual driving and I think it makes sense to the consumer,” Patel says.
The program uses Arity’s driving score modeling, Drivesight, which is built on one trillion miles worth of driving data, according to Henry Kowal, director of outbound product management, Insurance Solutions at Arity. Drive’n Save monitors four main driving behaviors–hard braking, frequent speeds, the time of day folks drive and phone distraction.
Kowal says UBI programs can improve driving behaviors.
“The app provides feedback on how an individual is driving and through that feedback is an opportunity for the individual to try to improve their driving and then, like phone distraction, for instance, we kind of gamify some of the elements of the app in the form of what we call streaks. So, drivers compete against themselves to try to maintain phone distraction free trips,” Kowal says.
Participants in the program will receive up to 10% in discounts on their premiums–those with good driving scores will receive a higher discount than those who have poorer scores. Drivers are able to opt into the program and then download the app to consent to having their driving data collected.
Read more about distracted driving digital tools here.
“The power of a program like this is it provides an opportunity for those who maybe aren’t very good drivers to improve their driving behaviors,” Kowal says.
While younger people are often more likely to opt in to UBI programs, an increase in insurance shopping because of economic pressures has seen overall interest in telematics rise across age demographics.
“There’s a lot of shopping going on in the industry and everyone is looking for the best rate, because their pockets are being pinched for everything,” Patel says. “We’ve seen a lot of older members want to do this too, as a way to save money.”
