Thursday, December 14, 2017

Chinese car insurers to use big data in pricing

Instead of charging premiums based on a driver’s past claims, Chinese car insurers are now employing big data when pricing policies, the official Xinhua news agency has reported.

According to the report, car insurers in China will employ a usage-based insurance structure, which will look into a client’s real-time driving patterns through the analytic systems in cars.

Zhong An, China’s first online insurer, and Ping An recently launched Bao Biao Car Insurance to exploit this technology.

The key to such analytics, said Xinhua, is an accurate analysis of drivers’ behaviour based on a huge amount of user data.

Accident-prone and erratic drivers will be asked to pay higher premiums, while those who drive smoothly and without incident will pay less.

The report added that usage-based insurance could be a Rmb300 billion (US$47.1 billion) market in the country by 2020.

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