Needs of the Small Commercial Fleet Owners
There are many needs of the commercial fleet owners, as far as the Usage-Based Insurance (UBI) is concerned. In this presentation, we only focused on the things that UBIs can provide.
Lower Costs on Insurance
Safety Guarantee for Customers
Speed and Efficiency of Service (getting customers and shipments from Point A to Point B)
What motivates commercial fleet owners and the pain points that they are facing?
As far as the proposed UBI is concerned (i.e. True Motion), the main motivation would be cost reduction. Insurance premiums could easily account for a significant chunk of the commercial fleet owners’ expenses . Commercial vehicles typically command higher insurance premium payments than private ones so this is one of the pain points .
Vehicles used for commercial purposes would almost always encounter a road accident; this is not a question of if but when . When they do encounter accidents, the commercial fleet owner’s record on the insurance firm can get tainted and this may cause future insurance premiums to be higher—leading to higher overall costs.
The out of pocket costs of repairing damaged cars from the commercial fleet that are not covered by insurance can be high . This serves as a great motivation for commercial fleet owners to make sure that all cars in their fleet are insured. And because of the lower costs of UBIs, assuming that their drivers are well-educated on how to drive safely, they would have all the motivation they need to avail of True Motion .
What is the size of the commercial fleet owners market?
The size of the country’s commercial fleet market can be hard to determine, but it is a billion dollar industry . As the population grows, more and more people would be dependent on public transportation. As the economic condition of the country improves, more shipment would have to be carried by private fleets of trucks, leading to increased demands for commercial fleets . Therefore, the market growth for commercial fleet would be on an uptrend in the coming years.
Competitors
Within the United States, companies that have existing UBI offerings include but may not be limited to the following:
Metromile
Progressive
Allstate
Liberty Mutual Insurance
National General Insurance
Competitive Analysis
The main advantage of True Motion over its competitors would be the fact that it incorporates the use of UBI plus the improvement of driving safety for drivers . Driving safely is essentially being incentivized and so the drivers’ habits are expected to be radically changed as a result of continuously using the companion application . Factors that are included in the proposed product are:
Mileage
Time of day
Hard Braking
Acceleration
Speeding
Distraction
The application integrates these data into one block. The resulting block of data could then be sent to the insurance companies for assessment.
Products and Services to Provide
The main product or service being offered is the True Motion Application. Its main selling point or features would be its ability to collect driver-specific information for every vehicle in the commercial fleet and integrate it into one specific data block. These data blocks are what the insurance companies could use to assess the safety levels of the drivers in a particular fleet. In a way, this can serve as a gauge on how safe a specific driver is driving versus the others, and can then be used as a feedback mechanism.
Product Description and Usage
The product would be a built-in component for all vehicles that belong to a commercial fleet. It would serve as a gauge on how safe a specific driver in the fleet is driving. The necessary feedback can then be given to drivers who are engaging in unsafe driving patterns and habits. This can be done to prevent accidents, delays in the delivery of service, and even the accumulation of incidents of accidents which could taint the commercial fleet owner’s record.
Marketing
The product can be marketed as a standalone application that commercial fleet owners can easily download via an app store, depending on their mobile device’s operating system. Advertising and marketing campaigns would be launched targeting motoring and automotive websites and forums (e.g. Top Gear, Edmunds, among others). Social media and internet marketing are proven and low cost ways to reach out to the target markets .
Conclusions and Recommendations
In conclusion, the proposed tool is not expected to boost the revenues of commercial fleet owners but rather to cut down their costs significantly. Either way, this is still a good strategy to boost profits—because profit is equals to revenues minus cost. Additionally, it can be a good way to discipline drivers who engage in unsafe driving habits; as the tool is basically a surveillance tool that enables the fleet owners to track the behavior and habits of driving of their constituents.
Works Cited
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Golia, Nathan. "Usage-based Insurance: 5 Reasons this is the Year." Drive Factor (2016): Web. http://www.drivefactor.com/usage-based-insurance-5-reasons-this-is-the-year/.
Intellimec. "IMS UBI Intelligence Usage-based Insurance Solutions." IMS (2016): Web. http://www.intellimec.com/usage-based-insurance-telematics/.
Morse, David. "What is Usage Based Inurance (UBI)." True Motion (2015): Web. https://gotruemotion.com/what-is-usage-based-insurance-ubi/.
National Association of Insurance Commissioners. "Usage-based Insurance and Telematics." NAIC (2016): Web. http://www.naic.org/cipr_topics/topic_usage_based_insurance.htm.
Salehi, Mehrdad, et al. "Dissimilarity of E-marketing VS traditional marketing." International Journal of Academic Research in Business and Social Sciences (2012): 510.
True Motion. "Attract and retain the safest and most profitable drivers with our behavior based insurance platform." True Motion (2016): Web. https://gotruemotion.com/insurer-telematics/.
—. "For Drivers." True Motion (2016): Web. https://gotruemotion.com/app/.
—. "We are committed to ending distracted driving." True Motion (2016): Web. https://gotruemotion.com/distracted-driving/.
