from scratch part 2 - teen drivers- the highest risk category

[northwoods2]

The death of a child is a parent's worst nightmare. A new approach to monitoring their driving may help.

The potential for reducing the crash and death statistics for this driver class is significant. A brief look at teen driver collision and death statistics provides an idea of how severe a problem this is.

2017 Teen Crash Data
· 2,526 teens killed in crashes nationwide

· 297,000 nonfatal injuries occurred among adolescents nationwide. This data does not include non-injury crashes.

· 9% of teenage motor accidents involved distracted driving

· 1,830 drivers nationwide aged 15-20 were killed in alcohol-related crashes

· 22% of teen drivers were not wearing a restraint during a collision but account for 57% of fatalities.

What if kids in this class were monitored closer? the telematic devices can record speed and of course acceleration. Can do nothing about impaired driving, but there are other ways to deal with this that I will go into later on in these pages.
The driving habits can be reported to the insurance company, parents, or both and appropriate corrective measures taken.
So, what if these statistics could be reduced by 10% just by reporting careless driving?

 

[adjusterjack]

Parents are the ones who provide the cars to teenagers and pay the insurance premiums.

Are you going to have a healthy discount at the front end to induce the parents to go along with the program? And further discounts on renewals for success with the program?

 

[fed up]

And the kids, who are smarter than their parents, will find a way to hack the telemetric device, share it on tictoc , and defeat your idea.

 

[northwoods2]

Parents will go along with this idea, as they have a vested interest in keeping their kids in one piece.

The telematic device could be hacked, yes. Do not know this as of now. The manufacturers will have to respond with more secure devices. If the device is so much as unplugged, this information is known.

 

[scagnt83]

State Farm already does this with their safe driver program. Its not exclusively for teens. But its great as a parent of a teen driver. My 19 year old has a score of 79 out of 100. It shows where she traveled, how fast, how hard she braked, how hard she cornered, etc.

I will say the tech is not perfect, and gets some stuff wrong. But overall its pretty good so far.

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As far as kids hacking them. Its possible but not easy. They would have to be able to hack the phone app it syncs with as well in order to falsify the data being given.

It takes specialized computer programs, tools, & knowledge to do. Along with knowledge about automotive computers and data.

They could hack it to turn it off. But the parent will know immediately. But why hack it to turn it off when they can just unplug it?

 

[scagnt83]

Can do nothing about impaired driving,

New cars can. They monitor lane accuracy with all the fancy gadgets they have.

The lane accuracy info can be collected through the telemetric device on many models. If they show a significant difference during certain times, its indicative of probably being impaired.

 

[scagnt83]

While I get the skepticism of everyone. But yall act like there is never a game changing company that comes along and upends the market. Maybe this dude will do that. Maybe he wont.

I will say that major insurance carriers are very set in their ways. We all know this.

Is there room to save 30% on the current business model? Maybe.

Imo, the litigation aspect is the most important. After seeing how that world works. That is the big cost imo. I could have squeezed an extra $800 out of my claim years ago had I gone and got paperwork amended. So many ways to "game" that system. Serious reform is needed on that end.

My biggest question is how the OP plans to handle paying claims and litigation surrounding it.

 

[adjusterjack]

Parents will go along with this idea, as they have a vested interest in keeping their kids in one piece.

No, parents will go along with this if the cost of their insurance is reduced.

I can guarantee that for 3 reasons.

1 - 35 years in the insurance business.
2 - Lifetime insurance buying consumer.
3 - Parent of a former teen-age driver who now expertly pilots an F-450 dually hauling a 35' travel trailer.

Fail to consider the consumer's emphasis on insurance cost and your business model fails.

 

[northwoods2]

Thanks for the replies.
Cost is a prime factor in the new model. My research shows that 30% average premium reduction is a conservative estimate. After taking a close look at how the ins biz spends money, and the shift from brick and mortar to home offices ( I am doing this running a small engineering business from home office), Take a look at the huge corporate campuses of the majors like state farm, allstate, etc. Corporate bureaucracy has choked many otherwise fine companies to death. Major change is to farm out most of the bureaucratic pillars and concentrate on the policy itself.

(AdjusterJack - your points of view are very important to me. I look forward to more commentary! )
My experience is in engineering and manufacturing at large corporations. The waste I have seen over the years was criminal/stupid.

Proctor and Gamble did this and is doing very well as a result. One small item - the telematic device. Check out Amazon and see the number of these out there. Only when quantities get really huge would I ever consider building a factory when right now they are pretty cheap. Some also offer the data collection service.

Remember the GM Saturn? Family had 2 of them. Not a really great car, but decent and easy to work on with good mileage. It was a separate entity at GM - for a time. After its main supporter left GM the car suffered from poor design decisions and bad management when the old school GM guys stuck their noses in it. Rumor has it that up until 2003 they were good cars. The following years became progressively worse. Died following the bankruptcy.

Hacking is a concern, but not a big one. The electronics contain ROM chips and are "burned" at the factory. Getting between the device and the cell tower will present a formidable challenge.
Paying claims and funding litigation is factored into the business model via reserves. State laws forces ins cos to retain adequate funds for disasters and litigation based on their risk exposure.

Glad State Farm is looking out for teens. Did not know this.

I just looked up SF corporate headquarters in Bloomington Ill. HUGE. 2,000,000 sq ft

 

[tikibarrister]

I will say that major insurance carriers are very set in their ways. We all know this.

We do?

Progressive, GEICO, Allstte, State Farm, and I'm sure others offer telematics and discounts to go along with them. In my experience, insurance companies adapt to changes.

Already, if you drive recklessly, speed, etc. that is reported to the monitoring insurer. So what, exactly, is new or different being proposed here?

I mean, @northwoods2 in your other post you proposed a feature and then in your very next sentence said it was something Progressive was already doing.

Yes, there is waste in corporate America. What a shock. But that's irrelevant.

So far, the two ideas you've presented have already been done (for years) by massive corporations with tremendous financial resources.

Really, the clever analysis, the technology, etc. is the easy part. GEICO, Progressive, etc. spend hundreds of millions of dollars annually on marketing. And this isn't some market where there's fat profit margins or it's expanding so fast that there's room for lots of players. You've quite literally chosen one of the most competitive markets on the planet. A market with many large players and relatively thin margins on a commodity product...well, any 1st year business student can tell you how that works.

If you truly had something revolutionary or gamechanging, then your plan - let me guess, it involves asking people to finance your dreams through equity investment - might have a chance. But nothing you've presented here is even new, much less differentiating, much less revolutionary.

Glad State Farm is looking out for teens. Did not know this.ft

If you're this familiar with your competition, how well-baked is this "model"?

As @scagnt83 pointed out regarding the capabilities of the last few years' worth of car production, you don't seem to even be that familiar with the technology side of things.