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Time-Based Insurance and The Data-Driven Broker: A New Model?

Hugh McTavish is a broker on a mission – one that disrupts traditional commercial auto insurance servicing, and, as a byproduct, actually causes clients to understand insurance. And all this because he got bit by the data bug.

We’d like to know what you think about his approach.

Making data make sense out of insurance

McTavish is president of Godfrey-Morrow Insurance, which writes in Alberta and Ontario.  Back in November, McTavish launched InsureMy Ltd., a technology-driven brokerage which set its sights on “changing the way Canadians think about insurance” by applying telematics and data analytic tools to complement standard insurance products.

McTavish was taken by the potential of the data aggregated by telematics.  In an interview with, McTavish noted that people are reluctant to share information with insurers, fearing rate increases. McTavish decided that his role as a broker was to “show how data could be used to the customer’s advantage.”

To achieve that, McTavish determined he had to specialize, creating a brokerage that would concentrate on data.  In this, McTavish found a willing technology partner in Intelligent Mechatronic Systems (IMS).

“We knew what we wanted to do.  IMS helped flesh it out,” McTavish said.

 It’s about time …

The result, announced today, is Canada’s first time based insurance  (TBI) product: a commercial fleet product designed to save commercial risk and fleet managers time and  money.

It works like this:  Every vehicle in the fleet is equipped with a telematics device.  This gathers data when the vehicle is in use which can be used by the fleet manager to optimize fleet utilization, and by insurers for rating and underwriting.

In addition, the device will also track the amount of time the vehicle is not in use.  Based on these data, three insurers have agreed to provide InsureMy  clients with premium refunds.

This is innovative because…

As Celent’s Mike Fitzgerald frequently points out, Innovation means breaking historical tradeoffs

In the past, insureds could take vehicles off risk if they were not in use.  However, this required the insured notifying the broker each time the vehicle was deactivated and then reactivated.  The trade off for premium savings was the extra work.

Making use of the telematics devices breaks that trade off.  In addition, the insured begin to realize that data sharing with insurers can improve efficiency for the fleet/risk manager while saving premium charges.

Success breeds success

McTavish notes that the success in simplifying premium management reduces the resistance to discussions about sharing data for other insurance usages.

This is aligned with IMS’ view.  Lara Ghaddar, Senior Manager of Business Development at IMS said: “The advancements made by InsureMy in the insurance brokerage space re-iterate the value telematics can bring to fleet owners and managers.”

Driving forward

McTavish isn’t going to rest on his laurels.  He won’t discuss specifics but does say that his business plan calls for InsureMy to grow dramatically over the next few years based on data driven initiatives.

And supported by satisfied customers.  McTavish said that after providing an overview of the TBI approach, an InsureMy client said, “Finally, there is something I can understand about insurance.”

What do you think?

We’d be interested in your thoughts about the InsurerMy model.  Could/should brokers look at elements as a future path?  Will insures support brokers taking a data driven approach??

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