Insurance

Mobile operator Telefonica connects car with insurance

Summary

The mobile operator Telefonica intends to introduce a technology in Germany by the end of the year that records the driving behavior of motorists and thus enables more flexible insurance tariffs. After the start in Spain with the Generali insurance […]

Mobile operator Telefonica connects car with insurance.  Like driving behavior, so is the tariff - this is the principle that insurance companies could use in the future (source: imago / TF photo)

The mobile operator Telefonica intends to introduce a technology in Germany by the end of the year that records the driving behavior of motorists and thus enables more flexible insurance tariffs. After the start in Spain with the Generali insurance group, talks are now being held with several insurers in Germany, confirmed Markus Haas, Director of Strategy at Telefonica Germany. Other mobile phone providers such as Vodafone are already working on such solutions under the heading of machine-to-machine communication (M2M).

Technology calculates the tariff

At the center of the system, called Telefonica Insurance Telematic, is a module that is built into the car and records information about speeding, braking behavior or night driving. This data is transmitted to the insurance company via the cellular network.

They can then be evaluated in the form of points and would be used in different ways to calculate the insurance premium. “In this way, risk groups can be better rated,” said Haas. Conversely, it is also conceivable that positive points are collected in order to reduce the amount of the insurance premium. This is also known as “Pay as you Drive”.

Introduction possible in 2013

It has not yet been determined when the system will be introduced in Germany. But he is assuming that there will be first offers by the end of the year, said Haas on the sidelines of the “Handelsblatt” annual conference TK Europe in Düsseldorf, where Telefónica presented the technology.

“A transparent process”

When asked about data protection, the Telefonica manager said: “This is a very transparent process.” The customer must expressly agree to each step. A recording of movement profiles is excluded. The Telefónica system also provides a smartphone app that shows the insured person the current evaluation of their driving behavior.

Discussion about data protection

The Federal Data Protection Commissioner Peter Schaar, on the other hand, sees such models very critically. “Anyone who chooses such a tariff has to accept the fact that a large amount of data is collected, stored and evaluated.” The distance covered, the driven speed and possible incorrect behavior of the driver could be completely reconstructed.

“Basically, it is a” voluntary “data storage of the car owner.” According to Schaar, depending on the structure of the premium, voluntariness could in future become an “economic compulsion” – “the legislature should put a stop to this”.

Schaar: Problem with several drivers

According to Schaar, it becomes particularly problematic when a car is used by several users. “Then the owner (policyholder) could check the other drivers and precisely reconstruct the distances covered.” With the smartphone app, for example, the employer could monitor the whereabouts of field workers in detail and up-to-date.

Technology also possible in other areas

M2M technology is not limited to driving a car. By 2020, the industry expects 50 billion devices worldwide that will be networked with one another via the Internet Protocol (IP). “We assume that there will be many more initiatives across industries,” said Haas.

At the Mobile World Congress in Barcelona at the beginning of the year, the Swedish network technology manufacturer Ericsson named among other things industrial machines, vending machines on the platform and medical devices. In addition to the connected car and the intelligent energy network, transport and logistics are two sectors that, according to a spokeswoman, Deutsche Telekom is keeping an eye on when developing M2M solutions.