O2 drives down motor insurance premiums with latest IoT offering

O2 drives down motor insurance premiums with latest IoT offering

O2 Drive(s) down motor insurance premiums with latest IoT offering
O2 Drives down motor insurance premiums with latest IoT offering

Mobile network operator (MNO) O2 claims to be the first mobile company in the UK to offer car insurance with the launch of its IoT-based monitoring service, O2 Drive.

Alongside O2 Drive, the MNO has released a telematics proposition know as Box on Board, which was built with the assistance of Junction, insurance provider BGL Group’s brand partnership arm.

Both versions of the policy aim to encourage safer driving, while providing exclusive perks and potential discounts on insurance premiums.

O2 Drive app

To benefit from the policy, which is also available to those who aren’t current O2 mobile customers, users must download the O2 Drive mobile app.

The app, which uses a GPS signal, allows users to manage O2 Drive directly from a smartphone, supposedly providing access to driving scores, as well as perks like car servicing, emergency breakdown services, safer driving tips, and important documents like policy details.

The MNO also says that the app’s Car Assistant also allows customers to have discounted repairs, MOTs or servicing arranged for them directly with a local garage, with a 12-month guarantee on any parts or labor.

Related: How data is revolutionising car insurance

The policies

With the O2 Drive policy, existing O2 mobile customers will have the chance to reduce their car insurance premium upfront, which is, as the company puts it, “because we know you.”

Those who are not existing O2 mobile customers will not have this luxury, and may choose to opt for the Box on Board product, which requires a small telematics device to be installed alongside their car battery.

The telematics device will monitor driver behavior, with the idea that safer drivers will be rewarded with reduced premiums. O2 has acknowledged that this kind of technology tends to benefit young drivers aged 17-24 most.

Should O2 mobile customers choose the Box on Board, their insurance premiums will be lowered even further up front.

Related: Why insurance needs verification speed for IoT, fast

Additional perks

Through the mobile app, O2 says its customers will also receive exclusive perks all year round as part of their policy – from retail and restaurant vouchers to car accessories – whether they are an existing O2 customer or not.

They will also be able to access O2 Priority exclusive discounts and rewards.

In a statement, David Plumb, digital director at O2, said: “Despite the rapid evolution of technology, the way we insure and service our cars has remained largely unchanged, with customers telling us that buying insurance is impersonal and confusing. We are on a mission to make customers’ lives easier through mobile, which is why we created O2 Drive.

“Based on the excellent feedback we’ve had so far for O2 Drive, the Box on Board proposition was created to further simplify the challenges of owning and driving a car safely. It unites our customer experience with our expertise in mobile to create a more personalized service – insuring people for who they are and rewarding them as they drive.”

Could this take off?

Sharing his view on O2’s new offering, Alan Stevens, chief scientist at the Transport Research Laboratory (TRL), told Internet of Business: “We have seen this concept before, with a trial being conducted a few years ago by Norwich Union (United Kingdom). However, at the time, the market and the technology were relatively immature.

“Today, the sector is in a position where this could potentially take off, even covering the whole vehicle insurance market and not just young drivers. These sort of partnerships allow the industry to move forward and embrace technology to increase safety and  driver convenience.”

TRL’s head of insurance, Iwan Parry, suggested that telecoms companies have a strong hand when it comes to this market.

Parry told IoB that “The rise of the mobile device as a means to gather this data opens a much wider market, reducing costs and the ease of engagement.

“By entering the market, O2 demonstrate the importance of telecoms companies’ links to customers and their significance as data carriers. These carriers will be key to the future of connected vehicles which is likely to be the next disruptive force for traditional telematics.”

Related: Are insurance companies ready for driverless cars?