The industry will change substantially
in the next three to five years and here are
10 factors that will have a major impact
on the auto and property & casualty segments as identified at the J.D. Power Insurance Claims Edge conference last fall.
1 Technology Technology is a huge driver of cus- tomer satisfaction, from whether or
not a driver’s phone syncs with an auto’s
systems to how easy it is for policyholders to contact an insurer online or with a
mobile device. A J.D. Power study found
that how well drivers’ technology synced
their vehicles was a key determiner of
whether or not they would purchase the
same car the next time.
Cell phone use continues to play a major role in accidents — accounting for
26 percent of all motor vehicle crashes
in 2014 with 5 percent of the crashes involving texting and 21 percent involving
people who were talking on the phone.
In the five seconds it takes a person to
take his eyes off of the road while texting,
a car can travel 403 feet at 55 miles per
hour — longer than the length of a football field. While most people don’t text at
this speed, even at 20 miles an hour, a car
can still travel about 100 yards.
Despite cell phone use restrictions and
texting bans in almost every state, drivers
will still talk and text, and this will continue to be an issue for insurers.
To those outside of the industry, there is a per- ception that insurance is dull and boring, behind the times technologically and certainly not a field
anyone would consider for a career — but they are so
wrong. Insurance is a vibrant, challenging industry where
the risks and rewards constantly change and the primary
focus is to make a positive impact in the lives of those
who need assistance following a devastating loss. And it
is the only career option that offers a 98 percent chance
of employment after college for students who choose
risk management or other insurance-related majors.
2 Aluminum & composite cars Fuel economy mandates are forcing manufacturers to use more aluminum in cars. By 2025, aluminum use in
cars will grow from 343 pounds to 550
pounds. Currently, aluminum is used primarily for wheels and engines, but that
is increasing to include trunks, hoods,
doors and in some cases, the entire body.
The Highway Data Loss Institute conducted three separate analyses of crash
data supplied by companies to estimate
the effect of aluminum on repair costs
and claims. Using large luxury cars from
BMW, Mercedes and Audi from 1997
to 2013, they examined the differences
between aluminum cars and their steel
The first analysis examined the Audi
A8, BMW 7 and the Mercedes Benz S
Class and was based on 67,756 collision
claims. They found that overall claim severity for aluminum Audi A8 cars was 14
percent higher compared to their steel
counterparts. The Audi A8 repairable
claims were also 13 percent higher than
comparable vehicles. Salvage rates for all
of the cars were under 10 percent.
The second analysis compared the
Audi A6, BMW 5 series, Mercedes Benz
E class and Jaguar XJ for model years
1997-2013 and involved 281,000 colli-
sion claims. The analysis compared low
component use of aluminum for items E m a