Root Insurance is preparing to adapt its business model to continued innovation in the mobility sector — from ridesharing to autonomous cars, Mobility Buzz has learned.
And it all starts with the company’s new program for Tesla owners. The program offers Tesla owners a discount if they use Autosteer — an updated feature of Tesla’s Autopilot software that keeps the car in its lane even when approaching curves.
“We are very interested in autonomous vehicles right now, we believe they are the of future, and a disruptive force,” Founder Alexander Timm told Mobility Buzz. “That being said, I think it’s a longer tale than people are maybe guessing right now. The technology has made serious headway, it’s just not to the level of full autonomy yet. But we do know it’s going to happen and it’s going to be a game changer.”
The auto insurance companies that will really prevail in that autonomous vehicle environment are the ones that are embracing the technology now, Timm said, which is why Root is offering the Tesla discounts, and looking into similar offerings through other automakers.
Traditional insurance carriers that don’t embrace the technology as it comes to market, will not have the data needed to help answer some of the bigger questions at the time of the incident, he said. For example, was the car in autonomous mode during the accident? Was the consumer actually driving? Who should be held liable? “Those are things that existing incumbents aren’t really prepared for, but we are certainly. We are actually investing in that currently,” Timm added.
While Root is not working directly with other OEMs, it is testing other potential programs, he said. “We know a lot of cars are becoming more and more autonomous, and we are trying to understand how all these different systems and programs work, because it is not going to just be Tesla that is doing this in the future; it will be pretty broad market.”
Self-driving cars isn’t all Root is interested in covering. The company is looking into rideshare and carshare insurance offerings, Timm said. “Ridesharing insurance is definitely something we looked into before, because we know we can collect data on those drivers when they are in different modes,” Timm said, referring to the different periods of rideshare drivers. Period 1 of ridesharing, for example, is when a driver turns on the rideshare app, until they expect a ride, and until that time the driver has limited liability coverage.
“We actually feel very comfortable with the risk because we understand how people are driving, and how they are using app, and so we have considered [rideshare insurance],” Timm said. “We haven’t launched any program yet, but it’s definitely something we have talked about. After we really expand, I think we will definitely be looking at those sorts of product extensions.”
Columbus, Ohio-based Root, a mobile-only car insurance carrier, uses an app and artificial intelligence to determine driving habits — and give good drivers lower rates. The app enables customers to personalize their quotes, purchase policies, and manage their plans.
The agency, founded in 2015, became a licensed insurance carrier in 2016. It operates in Ohio, and launched its services in Arizona two weeks ago, Timm said. Root is expected to be “in a majority of states” by yearend.
Those interested in learning more about the evolution of the transportation industry should join us at the second annual Auto Finance Innovation 2017 conference, May 17-18 at the Hilton Bayfront in San Diego. Visit www.autofinanceinnovation.com and to learn more.1 - Reader Likes This Post