Shanai Ghosh, Executive Director and CEO of Zuno General Insurance Limited (formerly known as Edelweiss General Insurance) shared her views on SWITCH with Telematics Wire. She graduated with mathematics honors from St Stephen’s College Delhi and did her PG diploma in management from IIM Bangalore. She worked with Citibank, Tata AIG Life Insurance, Reliance Nippon Life Insurance and AU Small Finance Bank, before joining Zuno General Insurance in 2017.
Q. Tell us something about SWITCH.
We have been working on SWITCH for the last two years. You would be aware that recently in July 2022, IRDAI came out with sandbox regulations. Telematics regulations weren’t existing before. We started SWITCH 1.0 to test the water, whether there was acceptance to some level and more importantly whether people benefited from Pay As You Drive or Pay How You Drive product. Our first product was Pay As You Drive. It was launched during the pandemic and we wanted a completely frictionless experience. As a pilot, we kept it an app-based product so our product switched off insurance on the days you don’t ride. We found that a lot of customers benefited as they weren’t driving for many days during pandemic. They were able to save the premium on those days. This motivated us to apply again under the Sandbox initiative.
SWITCH 2.0 as the name suggests, it’s bigger, better, faster, etc. than switch 1.0. It’s an app a mobile telematics-based product that allows customers not to just save premium if they are driving less but it also allows them to save premium if they are driving better. We are not just saying that some people drive less or some people drive more. It’s not out of choice, that’s how their life is. It’s our way of encouraging and rewarding people who drive better through SWITCH 2.0.
We take an upfront deposit which is roughly equal to two months’ premium and that deposit can be used depending on how much you drive and how well you drive. These features we believe make SWITCH truly unique and the first of its kind in the country. I don’t think there is any mobile telematics-based product in the country today and especially one that incentivizes people for driving better.
Q. Which user segment you think will benefit most from SWITCH?
We’ve got two features in the product that allow you to get the best value for your car insurance. The first obvious choices are those who don’t end up using their car very regularly or those who are using their car less than 3-4 days a week. This segment would benefit. But we have another segment which is Pay How You Drive so anyone who’s a good driver could also benefit from this. We give a discount for your good driving. Potentially anyone and everyone who believes that they’re a good driver or who wants to be a good driver and a safe driver could benefit from this product. Our target is to actually give this product to all our customers even if you don’t save purely on the basis of the number of days you drive, but if you’re a good driver, you will definitely save on how good you drive. The impression which generally, we were getting it is going to be more useful for a person who is driving to office and coming back home doing lesser number of kilometers in a month rather than somebody who is running a transport vehicle, but it’s not like that. The transport vehicle will not be disadvantaged with SWITCH. As I said, we have two benefits of the product; drive less pay less and drive better pay less. I would like to again reiterate, that there are two benefits of this product one is linked to how much you use, how many days etc. the second is linked to how well you drive. Both don’t have to work in tandem sometimes they do.
Q. We have seen insurance telematics when implemented, has resulted in improved driving habits. In India how long before we see improved driving habits?
It’s difficult for me to comment on how long we will take but definitely, I believe that telematics-based insurance products will encourage better driving and for those people who are buying a product like this. We have enough data across the world that when people buy a product and they see the advantage of driving better, they are incentivized to drive better. Of course, there are other incentives to drive better; saving yourself; saving people on the road and also not damaging your car. What this product does is, it translates the benefit of driving better into a tangible value.
Our policy is an app that shows you the savings that you are accumulating because of good driving for every drive. For every drive, you score on a few parameters that we are tracking; for what makes a good driver. We give comments on whether you were good or bad and what could you have done to be a better driver. It’s not just about saying- Hey, this is your score! and this is your saving. It’s more about gently nudging the customer to become a better driver and hopefully create safer roads in the country.
Q. Does SWITCH have any in-cab coaching feature and if it’s not there, do you intend to integrate such feature in the future?
Right now, our product gives you feedback after your drive is complete. Not during the drive. It will not keep on coaching you not to brake harshly. We don’t want to do that yet. This is the first time that we are experimenting with this product in India. Maybe this in-cab coaching we can expect eventually. But we have to find out how to do it in a less intrusive way that facilitates good driving. We also don’t want people to get disturbed by a backseat driver. We are not sure that during driving, whether constant advice will be good or not. But, maybe for extremely bad driving or very harsh acceleration it may be required and you could potentially tell the driver to watch out.
Q. What is your priority with insurance policyholder?
Improving driving habits is definitely something that we hope to achieve through a product like this and it’s a learning journey for us. Right now we have to educate our customer on how he can get better with driving. Where did he go wrong? Hence, for every drive, we are creating a granular score and informing the customer what he or she could have done better during the drive. It’s an evolution and I’m sure, we’ll find ways to help them get better and better.
Q. Are you open to the ideas and solutions on app-based insurance from vehicle telematics companies and startups?
At this point of time, we have so many discussions underway. Thankfully people have seen us as one of the front runners in launching innovative telematics-based insurance products. Many people have reached out to us, and we are always happy to have a conversation because we truly believe innovation is one of our core values, and we believe that we have to push the boundaries. We have to find ways of bringing solutions to customers that they don’t even know they need. Of course, we are very happy to find and engage with telematics solution providers who can help us create a solution that would be of even greater value to customers.
Q. Why did you go for app-based telematics insurance rather than a black box based insurance telematics?
It’s a new product and when you are launching a new product, you want to expedite adoption. You want to reduce the inertia for adoption. If you tell a person that you have to buy a device, and the device comes and after that you have to install it. The entire process of activating the insurance becomes long drawn. We found that an OBD-based product would be a very long drawn activation. Second, we found that there was some hesitation in installing a device in car. And the third was the entire experience of installation even if they had to do it would have required them to go to some mechanic or workshop because they were not comfortable installing it themselves and the fourth is, there is cost of the device. We wanted to make it as frictionless an experience as possible for the customers to adapt to this new concept.
Q. Huge amount of data from Switch app will be coming to you. Will you look forward to monetizing this data?
As of now, we are just looking at how to use this data to personalize products and solutions for our customers. The data that we get, should help us train our product to offer more customized solutions, to correlate what is good driving, what is bad driving, and what kind of premium we can offer to customers. People who have created such products internationally and who have been running these products for over 10 years have constantly enhanced their products to become sharper and sharper in terms of evaluating what is good driving and what is bad driving.
We will use this data to personalize solutions and give customers more guidance on how to get better. As of now monetizing our data for third-party is not something that we’ve considered at all.
Q. Will you look at personalized services based on this data?
Based on many kilometers you’ve driven, giving you nudges on servicing, or prompting for changing tires. If we notice a jerk in the car, we can send a notification saying, are you okay? and if required we can trigger RSA. Or we can trigger an ambulance if required. So, there are many things that we can develop based on telematics. But, our first focus would be on how to improve the value that we are offering to customers.
Published in Telematics Wire