The PAYG car insurance revolution is underway, here’s some interesting news from the RAC;
Following a short period collaborating on the development of a new mileage-based car insurance product, the RAC has become a strategic investor in London-based insurtech Wrisk.
The insurtech company aims to bring transparency and flexibility to the sector through app-based insurance designed to adapt to people’s lives. Wrisk has recently partnered with several reputable brands including serving as the sole car insurance provider for BMW’s financial services arm in the UK and collaborating with Allianz Automotive.
The RAC and Wrisk are trialling a mileage-based car insurance product which enables customers to only pay for the miles driven each month, plus a flat fee for when their cars are parked.
The transparent monthly subscription insurance plan is designed to give customers the flexibility to choose the cover they need for their lifestyle. The plan offers an extensive choice of add-ons, from personal injury cover to accessory cover, as well as real-time pricing that reflects changes immediately, without incurring any fees. In addition, the subscription-based model gives customers the control to cancel at any time. The product is underwritten by the Munich Re group of companies.
Quotes for the pay-as-you-drive insurance product are delivered in around three minutes from only a handful of questions, hugely simplifying the 45-plus questions typically asked by comparison sites.
RAC Insurance and Financial Services managing director Mark Godfrey said:
“Our initial innovative work with Wrisk was so encouraging we decided to take a stake in the company. We are convinced there is a significant section of the motor insurance market that only drives lower than average miles every year who are not well served by the way standard car insurance is priced and who could benefit from a product that is set up specifically to cater for their needs that can be taken out quickly and is simple to cancel should it no longer be required.
“Our two companies are a good match in terms of our capabilities. RAC Insurance has a wealth of pricing expertise from using data to help insurers better price risk and experience from its hundreds of thousands of telematics devices which provide a powerful insight into the lower-mileage driving market.
“The Wrisk team is remarkably resourceful and agile. They have developed a flexible platform which is ready to deliver on a market need via a straightforward, easily scalable, app-based user experience.”
Wrisk CEO Nimeshh Patel said:
“From the very outset of our partnership the RAC had a clear vision to create a more holistic, engaging insurance experience for its customers, which fit perfectly with our mission to deliver customer-first insurance solutions which are simple, personal and transparent.
“Together, with our mutual belief in challenging the standard car insurance model, we have created a solution that meets the needs of today’s motorists and moves us closer to making usage-based insurance the norm.
“Through the WriskScore™ we are helping to recast trust and transparency in insurance, allowing customers to understand the factors that affect their quote, to make buying an insurance policy a positive life choice rather than a chore.”