Econet hints at telematics insurance
ECONET has hinted that it may venture into telematics insurance following the recent launch of its motor insurance service, EcoSure Moovah.
Telematics insurance is car insurance where the premiums are quoted based on driving behaviours of the policy holder as recorded by a device fitted to the vehicle.
It has emerged as a popular trend in the global insurance industry with an estimated 6,7 million policies in Europe alone at the end of 2016 and 30 million policies expected by 2021. Zimbabwe has, however, lagged behind in this space as there is not even a single local insurer offering such a service.
Speaking at the launch of EcoSure Moovah in the capital last week, Cassava FinTech Zimbabwe chief commercial officer, Givemore Jojo, hinted that a telematics insurance product may evolve from the short-term motor vehicle insurance service. He said the service would be offered at a discount to clients on its telematics service ConnectedCar, a move which he said would be part of the company’s future plans to introduce a product that would be priced based on behaviour.
“We will be offering a discount to our clients on ConnectedCar, this is part of our plans for the future where we will have those with safe driving habits paying next to nothing for their vehicle insurance,” Jojo said.
ConnectedCar monitors the location and movement of vehicles. In addition to location data, clients can know when their vehicle is switched on and switched off, as well as its idling status, location and speed. Econet says ConnectedCar gives clients “complete, up-to-the-minute knowledge” of their vehicle’s activities within Zimbabwe and across Africa.
Local insurance regulator, the Insurance and Pensions Commission, says the insurance penetration in the country is currently very low at less than 10 percent. Econet says it found in a study that some locals do not favour insurance because premiums charged locally are unfair.
“We wondered why there is such a low penetration rate and we went into the market to find out…some said the premiums charged are not fair…why should someone like Jojo, a salesman who travels a lot, be charged the same amount as someone who travels less,” said Jojo.
Telematics insurance is widely regarded as the Holy Grail of usage-based insurance ensures that policy holders are charged fair or “equitable” premiums and will be a welcome development to the local insurance industry, at least with respect to equitable premiums.
Speaking at the same event, Cassava FinTech Zimbabwe CEO Eddie Chibi said EcoSure Moovah was set to disrupt the short-term insurance industry for the good of motorists through its attractive value proposition.
“This innovation, which follows in the footsteps of our phenomenally successful EcoSure Funeral cover and our existing pioneering, mass market products, is sure to shake the industry for the good of the motoring public,” Chibi said.
“Not only will EcoSure Moovah offer choice and flexibility through the option of customers to pay their premiums monthly, but it will also offer incredible value addition through bundled benefits of up to $5 000 at very competitive and affordability premiums,” he added.