Page 18 - Insurance Times February 2023

up the add-on (from the available top-up alternatives) if the insurers can better comprehend actual driving patterns with
previously paid kilometres run out. behaviour-based insurance. Insurers are also prepared to
provide a seamless Omni channel experience, including self-
The Pay How You Use plan would impact the insurance rate
service options, allowing current and potential clients to buy
based on how an insured vehicle is used and/or driven. In
policies, request assistance, file claims, track open claims,
order to boost upfront pricing variability, the intrinsic
and more across multiple channels without experiencing
behaviour of the relevant customer segment may also be
service interruptions.
constructed utilising past data from the relevant customer
segment.
As technology further develops, insurers will be able to more
accurately assess risks using real-world data from millions
A Smarter Way Forward
of devices, while drivers can track their own driving
The insurance business is already experiencing a seismic shift
behaviours to save costs and increase road safety for all
as a result of digitisation. One of the most valuable assets
users. As more real-world data is gathered, we will be able
for insurers today is data, which enables carriers to create
to move to more reliable behaviour-based insurance
new products and policies based on changing consumer
approaches. Future predictions for auto insurance can lead
demand.
to greater equality, lower costs and the promotion of safer
By utilising cutting-edge technologies like AI, drivers and driving.
New India Assurance (NIA) Launches 'Pay As You Drive' Vehicle

Insurance Policy

ew India Assurance (NIA) launched its "Pay as reducing the risks associated with uninsured and
N You Drive" (PAYD) policy, dubbed as underinsured vehicles plying on the roads."
"revolutionary" with features like discounts on
Key Features Of The Product
renewals, coverage beyond distance limit, and
Discount on basic own damage premium during
enhanced protections such as nil depreciation, roadside help,
renewals based on the vehicle's mileage.
return to invoice, etc.
Continuous coverage even if the vehicle crosses the
The policy comes with various benefits. For instance, the
distance threshold limit.
customer can save money through discounts on renewal
premiums, provided the vehicle runs within the specified "Pay as You Drive" discount continues even if there is a
kilometers. The discount is applied on the basic "own claim.
damage premium".
It comes with add-ons for enhanced coverage, such as
In addition, the coverage will continue for the policy's nil depreciation, engine protection, return to invoice,
remaining duration even if the vehicle has been driven roadside assistance, etc.
beyond the threshold limit. India's largest non-life insurance
The Insurance Regulatory and Development Authority of
firm said in a press release that clients can still avail of a
India (IRDAI) has recently allowed insurance companies to
discount on the renewal, albeit at a lower applicable range.
launch telematics-based motor insurance covers, like PAYD
Besides these discounts, the policy buyer can include add- and pay how you drive (PHYD), enabling vehicle owners to
ons with an additional payment for enhanced safeguards, decide how much to spend on their car insurance. As such,
such as zero depreciation, engine protection, return to some insurance companies in India are offering use-based
invoice, roadside assistance, etc. car insurance; for instance, if your car remains parked more
Commenting on the product launch, NeerjaKapur, chairman in the garage, you can opt to pay less. It benefits those who
cum managing director of NIA, said, "PAYD policy fulfils a do not use their vehicles much.
long-standing demand of customers for simple and flexible
The PHYD insurance premiums are calculated based on your
products that consider different usage patterns. Our product driving instead of a fixed amount paid in a conventional car
is one of the few in the market to help the customer manage insurance policy. Hence, the distance travelled and the
his outflows towards vehicle maintenance."
person's driving behaviour are critical for companies to
She added, "This product will promote better compliance, determine your car in PHYD insurance premiums.

The Insurance Times January 2023 17