SoftBank invests in Zhong An International. Clover's new partnership. This week in insurance tech.
In 1998, Progressive rolled out a pilot program in Texas called Autograph to determine whether or not auto insurance premiums could be calculated on a pay-as-you-drive basis.
Since then, Progressive has continued to test and iterate solutions toward tracking individual driving behavior. In 2004, it launched a program in Minnesota called TripSense, in which it would send a dongle in a box with a cord to upload data to Progressive after 6 months. Four years later, it rolled out a product called MyRate, which wirelessly transmitted data collected from an OBD device to Progressive.
Eventually, the product was renamed Snapshot in 2011 and today is offered with the option of either the plug-in device or its mobile app. In February, Progressive said it had collected 300 million miles driven via its Snapshot mobile app.
With that context in mind, it’s interesting to look into the development of Columbus-based auto insurance startup Root Insurance. To date, Root says it has collected about 1 billion miles of mobile telematics driving data.
Root is a licensed auto insurer in 20 states and offers discounted rates based on driving data collected upfront. While Root is a top 50 app in the finance category, it currently only reaches 39% of of the country’s population.
According to filings, Root’s premiums grew to $14.9M in Q2’18 from $7.9M in Q1’18. A large portion of Root’s policies come through paid referral.
Here are a few other items to watch for Root moving forward:
1) Other ways it can take advantage of mobile: 100% of Root policyholders have its app installed. This enables new experiences in areas like claims that are tailored to mobile.
2) Geographic expansion: Root says it plans to expand into all 50 states and Washington, D.C. by the end of 2019. But in California, telematics UBI programs are only able to use mileage driven.
3) Channel partnerships: As Root grows its availability, it could potentially look to strategic partnerships down the line (one that could be interesting is the aggregator channel i.e. Credit Karma).
JPMorgan goes free
Outside of the insurance world, another big announcement this week was JPMorgan’s decision to launch a digital investing service that comes bundled with free or discounted trades.
Next week, 48M JPM customers will be granted access to the new digital brokerage. We do a detailed breakdown of JPM’s entire digital consumer banking strategy here.