In this opinion piece Penny Searles, CEO of Smartdriverclub, looks at the value of data from connected vehicles and how companies in the insurance sector can tap into this resource.
Right now there are well over a million cars on the road that have built in connectivity – the first step on the journey to the driverless car. These cars are talking at the speed of light to motor manufacturers, telling them where, when and how we are driving.
BMW, Vauxhall, Mercedes-Benz and Ford, some of the largest manufacturers in the world, include connectivity in all of their new vehicles, and are busy gathering vast amounts of data on when, where and how motorists are driving.
However, there’s a fight underway for access to connected vehicle data – insurers want it to deliver usage based insurance, vehicle manufacturers have it but are currently working out how to make best use of it and there are a whole host of other parties vying for access.
The problem is that the true owner of that data – the consumer – is largely unaware of the benefits of they can gain from this data or indeed, the efforts being made to wrestle connected car data from vehicle manufacturers.
According to a recent report, European insurers, car dealers, automotive aftermarket and mobility services operators, as well as European representations of both motorist consumers and SMEs are collaborating to urge EU decision-makers to act decisively to establish fair and equal access to in-vehicle data.
The fear is that vehicle manufacturers may limit access to data from vehicles and therefore limit the ability for insurers and independent service providers to compete on an equal footing to offer services to consumers based on their driving data. At the crux of the issue is consumer choice and enabling consumers to fully decide with whom they share their data.
But just how much are consumers aware that their car is generating data – loads of data – and who currently has access to that data?
Awareness is low because the current car purchasing process does not allow for detailed explanations about data ownership – in fact most dealers are simply not trained to cover this important point in the transaction process. This is a significant problem because consumers have much to gain from allowing access to their vehicle data but without the fundamental understanding of how that data could be used to their benefit, the default response is naturally one of suspicion.
The critical issue is when and how the customer is informed that data is being collected and how it will be used. Think about smart meters in the home. Adoption levels are low because the benefits haven’t been conveyed clearly. Consumers feel they have nothing to gain so why should they share their data?
What is needed is a clear understanding of the benefits of connected car data. Aside from facilitating usage based insurance and all the premium saving and safety benefits this can offer, through connectivity the car has the ability to communicate with other vehicles and organisations – including the emergency services. It could instantly report a collision, its severity and exact location, saving precious time for the ambulance team in a life-threatening situation. It could talk to its driver to let them know as soon as a fault occurs and where the nearest garage is.
When a breakdown does occur, the car should be able to tell the roadside assistance provider precisely where it is located. If a connected car is stolen, the exact location can be tracked so that the police know where to find it. Sadly, the understanding of these benefits has not permeated the mass market of drivers.
This is such a new and innovative area that there should be much greater transparency and clear communication concerning how driving data is going to be used.
In today’s world, we want more personalised services and expect to sacrifice certain elements of privacy for more targeted offerings. When we accept ‘location services’ on our smartphones, allowing the mobile provider to record data on how and where we use our phones, we know the benefits we will receive in return – personalised and local recommendations, tailored to what we are interested in and exactly where we are interested in seeing them. But what is the benefit to us when a manufacturer records data on how and when we drive?
This is one of the reasons I launched Smartdriverclub Insurance, I wanted to put motorists back in control by providing them with access to connectivity in their car but will full visibility over how their data will be used to facilitate these services.
The data belongs to the customer, not to Smartdriverclub, we just control it for them. If we have permission we will share that data with others, but we are always transparent in what we share and with whom. Motor manufacturers need to take on the same level of openness, and build trust with consumers around connected car data. The fight for the data has the consumer’s interests at heart but the battle will be all the harder if consumers simply don’t get the benefits.
[1] http://mashable.com/2012/11/20/online-shopping-privacy-study/#toKEVOlRu8qo
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