(Image source: Octo homepage.)
Octo Telematics, (London) a global provider of telematics for the auto insurance industry, has announced that it will acquire the usage-based insurance (UBI) assets of Willis Towers Watson (London), including its market-leading DriveAbility solution and the DriveAbility Marketplace. Octo reports that Key Willis Towers Watson personnel will also join the its team, including Geoff Werner, Global Telematics Leader, who has led the development and growth of DriveAbility throughout its lifecycle.
Following the transaction, Octo says that it will develop a strategic alliance with Willis Towers Watson on additional auto telematics opportunities to enhance both companies’ suite of products and services. The partnership will focus on further development of algorithms and other analytical tools to provide actionable intelligence based on accurate analysis of data. The effort will be led by Octo and guided by an advisory board chaired by Geoff Werner, who will report directly to Fabio Sbianchi, CEO of Octo. Willis Towers Watson will be represented on the advisory board by Duncan Anderson (Global Leader, Insurance Technology), and Tom Coughlin (National Partner, Willis Towers Watson North America).
DriveAbility aggregates and analyses granular telematics and insurance data to provide an what Octo characterizes as industry-leading driving score and to assist insurers to design, score, issue and bind telematics-based insurance policies. The solution also facilitates relationships between motor OEMs, telecoms, etc. and insurers to present convenient, personalized insurance offers to customers using pre-analyzed driving data. Octo sees significant synergies with its own drive for digitalization of the insurance sector, including its advanced big data analytics and the recent launch of the Octo Next Generation Platform (NGP), which the vendor says provides an insurance ecosystem offering a wide range of products and services to insurers.
Contextualizing the opportunity Octo sees through the acquisition, the company notes that the insurance telematics industry is growing at a rapid pace, with nearly 100 million UBI policies expected worldwide by 2020. This growing adoption will produce ever-greater amounts of data that insurers can use to in accurately price risk. “Big data analytics are therefore crucial to break down telematics information such as driver behavior data to create driver scores, as well as carry out crash analysis and provide the full range of telematics benefits,” a vendor statement says.
Insurers Must Match The Pace of Telematics Evolution
Fabio Sbianchi, CEO, Octo Telematics, couches the acquisition in the observation that insurance telematics is evolving far beyond the simple black box hardware. “With ever-increasing data volumes being measured and recorded, the tools being used to analyze it and provide accurate driving behavior information to insurers must develop at a similar pace,” he elaborates. “It makes sense to join forces with Willis Towers Watson to pool resources and lead on further developing telematics propositions. Together, we can extend our geographical reach and leverage our respective established networks to maintain a leading position in enabling consumers and insurers to gain the maximum benefit from accurate telematics data.”
The rationale for the acquisition is also rooted in the two companies’ similar industry vision, according to Alice Underwood, Global Leader, Insurance Consulting and Technology, Willis Towers Watson said. “We’re looking to develop next generation solutions with our broad consulting, technology, product, and brokerage resources—solutions that enable our clients to be more successful. We’re always looking beyond what’s currently offered in the telematics space and leading the way in the development of the future.”
Analyzing data for insurers and constantly improving its offering in this area will be the focus of Willis Towers Watson’s partnership with Octo, Underwood adds. “At the same time, the IoT and big data are bringing ever more exciting opportunities for data analytics, and working with Octo puts us in a great position to stay at the forefront of this rapidly evolving global industry,” she comments. “We look forward to continuing to drive and improve the application of telematics and telematics data into an increasingly connected society.”