The insurance industry continues to be a hotbed of patent innovation. Activity is driven by digitalization, personalization, and growing importance of technologies such as artificial intelligence (AI), Internet of Things (IoT), and cybersecurity in insurance documentation and data analytics, predictive risk assessment, fraud detection, and smart policy management. In the last three years alone, there have been over 17,000 patents filed and granted in the insurance industry, according to GlobalData’s report on Innovation in insurance: driving behavior-based premiums. Buy the report here.
According to GlobalData’s Technology Foresights, which uses over 70,000 patents to analyze innovation intensity for the insurance industry, there are 20+ innovation areas that will shape the future of the industry.
Driving behavior-based premiums is a key innovation area in insurance
Driving behavior-based premiums refer to a type of auto insurance where the premiums are based on how safely the drivers operate their vehicles. This is done by using telematics devices or mobile apps to monitor driving habits such as acceleration, braking, cornering, and speed. Insurance companies use this data to create a driving profile for the policyholder and adjust their premium accordingly.
GlobalData’s analysis also uncovers the companies at the forefront of each innovation area and assesses the potential reach and impact of their patenting activity across different applications and geographies. According to GlobalData, there are 40+ companies, spanning technology vendors, established insurance companies, and up-and-coming start-ups engaged in the development and application of driving behavior-based premiums.
Key players in driving behaviour-based premiums – a disruptive innovation in the insurance industry
‘Application diversity’ measures the number of applications identified for each patent. It broadly splits companies into either ‘niche’ or ‘diversified’ innovators.
‘Geographic reach’ refers to the number of countries each patent is registered in. It reflects the breadth of geographic application intended, ranging from ‘global’ to ‘local’.
Patent volumes related to driving behaviour-based premiums
Source: GlobalData Patent Analytics
State Farm Mutual Automobile Insurance (State Farm) is one of the leading innovators in driving behavior-based premiums. State Farm customers are encouraged to enroll their vehicles in the Drive Safe and Save telematics program so that the auto insurer can directly monitor and record information including mileage and driving behaviors and adjust insurance premiums accordingly to reward safe and responsible driving habits.
In terms of application diversity, Cox Enterprises held the top position, while Flex and OPTIMUM stood in second and third positions, respectively. By means of geographic reach, Alphabet leads the pack, followed by INRIX and Flex.
To further understand the key themes and technologies disrupting the insurance industry, access GlobalData’s latest thematic research report on Insurance.