The concept of usage-based insurance is still little known in the country.
Usage-based insurance adjusts the premium based on how much you drive, so if you drive less, you pay less.
Fifty-eight percent of millennials and Gen Z are aware of usage-based insurance (UBI). According to the latest research, rewards for “driving safely” and “driving rating” are the two main factors influencing the choice of insurance based on usage.
A study titled “Usage-Based Insurance: Deciphering Awareness, Perceptions, and Behaviors” conducted by Zuno General Insurance (Zuno GI) (formerly Edelweiss General Insurance) was conducted to understand the awareness, understanding, and attention of millennials and Gen Zers towards UBI.
The concept of usage-based insurance is still little known in the country.
65% of respondents believe that people in India are safe drivers. 90% of respondents want a driving grade that shows how safe they are driving.
58% of survey respondents are aware of usage-based insurance, while 70% of respondents have a strong intention to buy usage-based insurance compared to other insurance options.
The study also found that 76% of respondents strongly believe that getting a driving grade will help improve their driving skills, and 95% of respondents believe that rewarding for safe driving will positively influence driving behavior.
What is usage-based insurance (UBI)?
Usage-based insurance is a concept that personalizes car insurance based on how you use, how much you use, and how you drive.
Traditional insurance in India, on the other hand, primarily calculates the premium based on what and where you drive. Distance/time traveled and your driving behavior are two important factors that determine a car’s insurance premium.
Usage-based insurance adjusts the premium based on how much you drive, so if you drive less, you pay less.
In addition, the insurance company uses data such as driving speed, acceleration rate, hard braking, distracted driving, and phone use while driving to calculate a driving score and reward you based on the driving score.
This data is collected either through a device connected to your vehicle or through an app on your phone.
Shanai Ghosh, Managing Director and CEO of Zuno General Insurance, said: “We aimed to gauge the understanding and perception of UBI among young, mobile savvy Indian customers. The findings were extremely insightful and confirmed our belief in the potential of UBI in India, encouraging us to continue investing in this category, which we first launched in 2020.”
“Given the exponential growth in the number of smartphone users in the country, telematics-based solutions will appeal to digital natives, allowing them to see and influence the prices they receive from auto insurance. With the findings of the report, we want to raise awareness of new concepts such as UBI, which will not only link the premium to your usage and driving, but will also promote safe driving in the country,” Shanay added.
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Namit Singh Sengar Namit is Senior Associate Editor of News18.com Business Vertical. With over five years of experience, he focuses on personal finance, brands, and economics….Read More