IRDAI, the insurance regulator in India has put out a draft report on telematics. The regulator has asked the insurers to send their views on implementing technology and revisiting the pricing methodology. The insurers have also been told to look at alternatives to conventional telematics devices like smartphones with mobile apps, dongles, black boxes, bluetooth etc.
Some of the impediments in the way mass adoption of telematics in India are:
- The high cost of the device.
- Getting device fitted in the vehicle so as it doesn’t affect its performance.
- Issues regarding data privacy and ownership of data.
But the insurers are skeptical of the effect telematics equipment will have on the price. The insurers feel it will just serve as a value addition for the customer, under the current regulations, as motor policies are tariffed the pricing variation doesn’t seem likely.