New Usage-Based Vehicle Insurance of TATA AIG Can Help in Saving Premium

Tata AIG General Insurance Company is known for its innovations and recently the company has launched Usage-Based Insurance (UBI) for its policyholders. The UBI is launched under the regulations of IRDAI’s Regulatory Sandbox. This private car policy is personalized, affordable, and it offers a customized solution for the driving profile of its owners.

This Usage-Based Insurance private car plan of TATA AIG General Insurance is a telematics-based device and application which is called AutoSafe. This AutoSafe app and device will be available with all the policies that will be offering coverage for the personal accident of Rs.15 lakh for drivers and owners. At the time of policy renewal, the AutoSafe will also provide bonus kilometers as a reward for good driving.

The most advantageous feature of usage-based vehicle insurance is that it can customize the motor insurance premium through telematics. Unlike a normal motor insurance plan, a policyholder does not have to pay a huge premium as per the make and model of the car rather it will be as per his/her driving skills under telematics (pay-as-you-drive) policy. The lesser/ better one drives, the lower premium he/she will have to pay for his/her vehicle insurance. This technology will also provide roadside assistance and have features of vehicle tracking. 

As per the press release of TATA AIG General Insurance Company Limited, this telematics app or device will be linked or fitted to the car of the policyholder and as soon as his/her car insurance policy becomes active, this device also becomes active and it is kept throughout the policy period. Further, this press release states that the AutoSafe device will be a GPS-enabled device and will have a linked mobile application. The mobile application and device will record all the information, will track the distance it has traveled and will generate a report related to the health of the car and policyholder's driving pattern.

Parag Ved, EVP, and Head – Customer Lines of TATA AIG General Insurance say that this shift to 'pay-as-you-drive' type of general insurance plan is making sense in the current scenario of pandemic wherein people are avoiding unnecessary journeys and the organizations are encouraging work from home culture.

The Framework of the Policy

The UBI private vehicle insurance policy for the vehicle owners is launched under the Regulatory Sandbox regulations of IRDAI. This policy is affordable and personalized and provides a customized solution concerning the driving profile of the policyholder. This policy also includes some other value-added propositions such as depreciation, daily allowance, reimbursement, no-claim bonus, etc. according to the press release.

Ved further says that because of the regulatory sandbox's permission to introduce a telematics-based solution, the motor insurance sector will evolve and become more responsive and intuitive to the requirements of the customers. He further adds that the Tata AIG Insurance Company is working meticulously to offer new ways for enhancing the experience of its value-added policyholders. With proposition 'value-added' he means that the value-added services and personalized advice as per the driving behavior of the policyholder.

Working of Device

The information that is collected is analyzed over time and every policyholder cum driver is given points based on his/her performance. Along with this, the device contains support for motion sensor and generates the reports for fuel-saving with monitoring aspects such as hard braking, driving, night-time, and the acceleration. With all this, the device also guards against the slippage of fuel and dangerous habits of driving.

How Is the Device Helpful in Saving the Premium of Insurance Policy?

This device and app help the policyholders save their insurance premium by selecting the driven kilometers, working as an anti-theft device, encourages safe driving as it has a GPS facility for tracking.

The policyholders will be benefited from the flexible package of the device which is kilometer based. This helps in saving the scheme as compared to a conventional car insurance policy.

A policyholder will be given an option to choose between 2, 500 kilometers, 5, 000 kilometers, 7, 500 kilometers, 10, 000 kilometers, 15, 000 kilometers, and 20, 000 kilometers. The customers who have exhausted their kilometers within the period of the policy will be eligible to purchase more kilometers by opting for the option of top-up the kilometers. In this way, it helps in saving the cost as per the usage and the release.

Summing It Up!

In this way, the driving habits of a TATA AIG Insurance Company’s policyholder will determine the premium of his/her vehicle insurance policy. The new usage-based insurance will help in analyzing the same. The device and app for the same will for sure be helpful for those who drive safely and avoid unnecessary driving.