What the future holds for mobility and insurance
Alberto Garuccio, Innovation Leader and Mentor at Reale Lab 1828 in Italy, spoke with Efma’s Boris Plantier, about Turin’s unique innovative venture and the future of the mobility.
Tell me more about the Olli bus experiment in Turin.
Starting in January employees and guests of the UN ITCILO campus based in Turin are able to move through the campus using Olli, a Local Motors autonomous vehicle designed to foster sustainable urban mobility. This experiment will last four months, during which the real mobility conditions of small-town roads will be tested and analyzed.
What makes this experiment unique?
It’s the first of its kind in Italy and our vision for this initiative goes far beyond the adoption of a new technology because it aims to realize a project to better deal with the paradigm shift required for the mobility of the future.
What role does Reale Mutua play in this experiment?
Reale Mutua holds two main roles within the initiative: as the main sponsor by concretely supporting the development of this experiment, defining guidelines, and being an active part of setup activities carried out in collaboration between our Group, Reale Lab 1828, City of Turin, ITCILO and Local Motors, and as insurer, guaranteeing the liability for damages caused to third parties caused by the vehicle during the experimentation period.
According to you, what mobility will look like in 2030?
In 2030, mobility probably won't look so different from what we know today. Currently all analysts agree that mobility is being transformed by three key technology-driven trends: mobility-as-a-service, electrification of vehicles, and connected and autonomous vehicles. I think that these tech trends are just the tip of the iceberg, because their roll-out depends on urbanization, infrastructure, and of course, local policies.
These enabling factors will have a longer adoption period than technology development cycles, so from my perspective we will see companies coming from different industries and other stakeholders involved putting forth their best efforts in creating and making this new paradigm sustainable. In the coming years, we will see a lot of use cases, differentiated by country, by territory (urban, countryside), and by scope (commercial, retail, public transportation), without reaching new standards in the global mobility industry before 2030.
Vehicles are becoming more and more autonomous. What impact will it have on insurers?
As you know from driver assistance to fully autonomous cars there are six generally accepted levels of self-driving vehicles ranging from zero (fully manual) to five (fully autonomous). While the future of autonomous vehicles cheering us up, mainstream production is still away from any vehicles higher than Level 2 and no commercially available vehicles have yet passed the required level 4 for autonomous driving. Anyway, the level of tech evolution achieved could already today have a positive impact on Insurers, reducing risks, or supporting better driving behaviors of our customers.
As mentioned before, medium long-term technologies and mobility-as-a-service business model adoption could have a huge impact on insurers, changing counterpart and risk relevance. From one side individuals may no longer need insurance coverage, for instance compelling providers to embed product liability solutions to sell into major mobility services fleets. From the other side, risks related to mobility could assume a different relevance for insurers, weighing up for example the significance of cyber risk attack. In both cases, the insurance industry will face deep operating, distribution, and business model transformations.
Autonomous vehicles are all about AI and data. What will insurers do with all this data?
Insurers have a great opportunity, but they must be ready to play a new role that goes beyond data and technologies like AI. Currently, best services in many industries are designed to deliver a hyper-personalized and real-time based customer experience. I think that this is not enough to realize a best-in-class mobility service.
All of us planning a trip try to predict which will be the best solution to reduce cost, time for travelling, and at the same time assure security and comfort. In a mobility-as-a-service ecosystem this approach obviously cannot be followed by a provider that is not able to monitor and optimize its value proposition through people flow and multiple related variables analysis.
To be effective these providers have to move from real-time analysis to prediction and from individual behaviors to flow analysis. Will insurers be able to play this role in the future using new technologies? I think so; looking at 2019 insurtech and the level of IT investment in the insurance industry, in the medium term many insurers may have the right capabilities to manage new data-driven mobility business models and to be recognized as trusted providers by consumers in terms of security and privacy compliance.
Insurers may be able to play the role of data aggregator in a mobility ecosystem, becoming a mobility advisor for final customers, but they must dedicate their efforts to being relevant for customers. This starts with directly managing a digital relationship based on a wide range of services and insurance products as well.