Insurance company Tower is expanding its digital capability and will be releasing in upcoming months a series of innovations in this space.

As part of this, Tower CEO David Hancock says the company is recruiting for the newly-created role of head of digital experience.

"It is all about innovation in the technical space," Hancock tells CIO New Zealand, at the launch this week of Tower's free smartphone app 'SmartDriver'.

"We are building a bigger digital capability. This is part of it," says Hancock of the app, which he claims is the first of its kind to be launched in Australasia.

'SmartDriver'' -- available on Apple App Store or Google Play - monitors and assesses an individual's driving behaviour, based on 250 kilometres of travel. Drivers who score well can then gain a discount on motor premiums of up to 20 per cent.

"If you are prepared to share your data with us, we interpret the data, you get things in return for it, it is very much about personalisation," states Hancock. "Digital makes that happen."

He discloses that more innovations will come out in upcoming months, as Tower is committed to inventing or working with different partners on "great pieces of technology. "

Mark Savage, general manager, customer proposition, says digital entails providing "options around customer needs, through digital channels".

Savage explains that the head of digital experience, who will be his direct report, will be the "champion for digital technology and will relate to what the customer needs". These include looking at the "usability of sites and tools. "

Driving for change

Hancock says the SmartDriver app will promote safe driving, as shown by trials of Tower staff and their families, and in overseas markets.

"As soon as someone installs this on their device, their behaviour actually starts to change. It is fascinating, they do become better drivers," says Hancock.

He notes: "Why should people who are safe drivers subsidise those who are bad drivers?"

As well as providing points for set achievements, after every trip, SmartDriver also provides a trip summary and safe driving tips to help motorists improve their driving behaviour.

Savage adds that the app means motor vehicle insurance premiums can now be based on an individual's driving behaviour, rather than solely relying on averaged claims risk and demographic data, such as age and location.

"This kind of user-based-insurance -- or UBI -- has the potential to dramatically change the motor insurance market .

According to Savage, telematics, the technology behind UBI, enables driving data to be gathered and transmitted directly from a vehicle on the road to the insurer. The insurer can monitor, analyse, score, and then adjust premiums accordingly.

"By collecting basic driving information such as trip duration, distance travelled, location, braking, and acceleration, we can build an understanding of driving behaviour and individual risk and adjust premiums accordingly. The app also allows customers to see their score versus the average score calculated from all the SmartDriver users, who have completed 250 kilometres using the app."

Savage expects SmartDriver to be "extremely popular", with over 60 per cent of Kiwis owning a smartphone.

Mac Fraser, CIO of DriveFactor, the company that developed the SmartDriver app for Tower, says he is pleased local drivers can now realise the benefits of user-based insurance through SmartDriver. "Telematics has been extremely popular around the world as people love to compare themselves to others and of course, to save money on their insurance."

"It's really good to see a private insurer sharing responsibility for improving road safety by using technology and incentivising smart choices," says Ernst Zçllner, road safety director at the NZ Transport Agency. "This is consistent with Safer Journeys, the Government's road safety strategy to 2020."


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