As the car insurance market evolves rapidly from the old TPF&T/Fully Comp model, sold mainly by comparison sites, into something more flexible, and pay-as-you-go, underwritten by driver and location data, partnerships are crucial. By pooling expertise and tech big brands, smaller insurtechs and innovative brokers, can all develop new products that match the lifestyle of the policyholder. It’s the future.
My Policy, a leading UK provider of data analytics and telematics insurance, announces today an investment by Zurich Group, as part of which Zurich will become a long-term insurance capacity provider, joining an existing panel of insurers to enable rapid growth of My Policy’s recently launched usage-based insurance (“UBI”) product, JURNY.
Zurich will become a strategic minority investor alongside existing My Policy management and Inflexion Private Equity (“Inflexion”). The completion of the transaction is subject to regulatory approval which is expected to be confirmed in the first quarter of 2021. The market for UBI motor products is a high growth international opportunity, driven by underlying changes in driving behaviour. The global UBI market is estimated to grow at a CAGR in excess of 29% to reach a market value of $190 billion by 2026, according to Acumen Research and Consulting.
This market growth has accelerated during the current COVID-19 pandemic as consumer driving habits have evolved, with various enforced lockdowns structurally changing the driving patterns of many. Analysis of UK driving behaviour by My Policy during the first 2020 lockdown revealed, at its peak, a national decline in mileage of 63%.
My Policy proprietary analysis also reveals that even before the pandemic, consumers on cover during 2019 drove, on average, 20.7% fewer miles than they expected to. A pay-per-mile product such as JURNY, where consumers only pay for the miles they drive, delivers tangible real-world savings for consumers. Another 2020 US survey by JD Power revealed that consumers were expecting to drive less in the foreseeable future and 40% were considering telematics owing to the cost savings they provide. This has led to a steady increase in consumer demand for UBI solutions.
Today’s announced transaction addresses this consumer issue by bringing together the strength of Zurich’s existing underwriting experience and My Policy Group’s high quality data analytics and product design capability, including innovative products such as JURNY. The transaction sees the continued support of Inflexion, a leading European private equity investor, as a shareholder in the group, as My Policy evolves to offer solutions for a new generation of motor insurance.
The transaction also sees Zurich’s telematics equipment provider, Bright Box HK Limited (“Bright Box”), incorporated into the My Policy business, creating potential for future strategic partnerships with BrightBox’s customers, which include a number of international original equipment manufacturers (“OEMs”).
Patrick Quinn of My Policy, says, “In our ongoing effort to tailor our insurance to consumers’ needs, we are aware that increasing our usage-based offering will benefit a greater number of clients as driving patterns change in 2021 and beyond. Zurich’s investment in My Policy enables us to significantly boost our capabilities and this, combined with My Policy’s new pay-per-mile platform, JURNY, and the ongoing support of Inflexion, will help accelerate our growth plans further and meet changing customer needs.”
Siwan Lu, CEO of Zurich Insurance Mobile Solutions, says, “Our collaboration with My Policy further highlights our commitment to providing user-friendly products to our customers in an evolving world. My Policy Group offers a smarter way for customers to insure their vehicle, whilst also giving them more control over their insurance costs.”