Over the past several weeks, there have been numerous aerial photos of some of the nations largest highway systems — devoid of vehicles. The sight of tens of miles of ramps, junctions and straightaways with no visible cars is startling, almost a made-for-Hollywood view.
But COVID-19 has taken a huge percentage of people out of their vehicles, leaving their cars idle in driveways and garages.
Given that vehicle usage is a fundamental and historical rating factor — a predictor of accident frequency — one could conjecture that telematics might be heading toward a new and shining position within the industry. There are several points for insurers to consider.
A huge percentage of businesses that have never had a home-based workforce have been compelled to have one due to stay-at-home advisories. Published interviews indicate that company executives across all industries believe the experience with COVID-19 will change the nature of work even faster than anticipated.
More workers will be home-based either permanently or part-time. Will a greater percentage of consumers see the value of usage-based, telematics-driven insurance, given that their vehicles will be idle for greater periods? Insurers need to be prepared for this outcome.