Japanese insurance giant to offer commercial drone insurance
A leading Japanese provider of property and casualty insurance and has joined forces with Flock, a UK-based insurtech that offers insurance solutions to commercial drone operators.
Sompo International Holdings is the second-largest property insurance company in Japan only behind Tokio Marin. The corporation has an extensive global footprint with nearly 80,000 employees in 228 cities in 30 countries, looks set to increase the availability of critical insurance for the emerging commercial drone industry.
Up-and-coming use-cases for this growing sector include drone cargo deliveries, flying taxi passenger flights, and drone swarm shows.
Sompo International has aviation and aerospace insurance underwriting experience and this will be combined with Flock’s real-time risk algorithms to offer a unique service to the drone industry.
Currently, Flock’s drone insurance products provide cover thousands of pilots operating across the UK and Europe. The insurtech has also been using proprietary technology to explore reinventing insurance for other speciality sectors.
The commercial drone industry is enjoying an upward growth trajectory as more and more use cases for drone usage emerge. According to industry reports, new technology drives the market as sensors carried by airborne devices have become increasingly complex. Currently, drones are used to collect essential data for a wide range of purposes.
· Visual data: This is by far the most common type of data drones collect.
· Thermal data: Aerial thermal data can help firefighters determine where to focus their efforts during an active fire, or help inspectors identify potential problem areas in a solar array.
· LiDAR data: Aerial LiDAR is used to create 3D maps of an area, used for project planning or progress tracking.
· Multispectral data: This is used in agriculture and conservation to monitor plant and tree health. It's also used by law enforcement to help find human remains.
· Hyperspectral data: Currently used in agriculture to monitor the health of crops, as well as security and defence for detecting trespassers.
According to a recent report, drone technology is also deployed to inspect nuclear power plants for safely and analysis purposes.
Julian James, Sompo International’s CEO of international insurance, said both insurance brokers and disruptors must collaborate to create new solutions to meet the emerging risks of the commercial drone market.
“The sheer breadth of applications means the global commercial drone market is expected to be worth in excess of US$40bn by 2025,” James explained.
He continued, “Flock is a market leader in this sector with tremendous potential; it has a proven business model utilising a transferable and scalable technology that has already delivered unique products and an impressive growth story.”
Flock’s CEO, Ed Leon Klinger, added, “By combining Flock’s data-driven approach to risk with Sompo International’s significant expertise and established global distribution networks, this partnership marks an important milestone in the evolution of drone insurance globally.”
TrueMotion insurtech acquired by Cambridge Mobile Telematics
One of the world’s leading telematics insurtechs, Cambridge Mobile Telematics, was launched in 2010 and powers 65 enterprise programmes in 28 countries.
Meanwhile, TrueMotion, which launched in 2012, has enjoyed significant success as a telematics operator, raising US$10mn in its seed funding round in 2010, and then partnering with the motor insurtech Noblr in 2019.
TrueMotion has also entered the European market, collaborating with LB Forsikring to promote safe driving in Denmark.
The joining of the companies means TrueMotion’s 150-strong workforce will join Cambridge Mobile Telematic’s already established team, along with their client list, which includes Travelers, Farmers, and Progressive.
The new company will focus on increased interest in using telematics for crash reconstruction in personal lines claims and more innovation in the telematics space.
Speaking about the acquisition, William Powers, CEO, and co-founder of Cambridge Mobile Telematics, described the move as an opportunity to explore new markets, expand throughout the US and bring telematics to a much wider customer base.
"With this acquisition, we will use our world-class talent, technology, and scale to help our partners overcome the complex challenges of global road safety,” he added.
Ryan McMahon, VP of insurance and customer affairs for Cambridge Mobile Telematics, explained that expanding the company with additional talent and customers would help meet the demands of a growing telematics market. He also quoted data from a study by J.D. Power which revealed that personal auto telematics users have doubled in five years to 16% of policyholders.
McMahon told the press, “This market is rapidly expanding, and building more capabilities is more important than ever,” McMahon says. “Both companies follow similar philosophies and grew up in similar ecosystems, and now we’re bringing those cultures together.”
He continued, “Telematics is absolutely the future of commercial auto and rideshare, and it’s kind of a step up beyond the normal telematics."
McMahon added, “We will not only widen our lead in smartphone telematics, but also use our combined talent to invent new products for risk measurement, contextual telematics, and crash mitigation across emerging mobile, IoT, connected-car, video, and sensing technologies.”
Five reasons why telematics is in demand
- It reduces fuel costs and increases operational efficiency. This is a consideration for most commercial fleets given the rising costs of fuel
- The technology enables fleet managers to plan operations with greater precision by providing exact locations, timescales, and speeds of vehicles.
- It improves driving standards and monitors driver behaviour, reducing detours and ensuring responsible driving.
- It helps fleet health and maintenance by monitoring the health of operational vehicles.
- It increases corporate social responsibility in terms of care for the driver, the vehicle, the impact of driving in terms of emissions, and also the security of the vehicle itself.
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