FSCO - UBI

Question 1

What does the term ‘opt-in’ mean in relation to UBIP?

Answer 1

Opt-in means that the insurance company cannot use UBIP data for non-UBIP purposes (eg: marketing) UNLESS the customer specifically consents by opting-in.

Question 2

What does the basic UBIP contract cover?

Answer 2

The UBIP contract is an agreement between the insurer and the insured BEYOND a typical auto policy: the insured will install and use a device; the insurer uses the data from the device only for a specific purpose.

Question 3

Insurer uses for UBIP data.

Answer 3

Valid uses:
- discount-setting
Invalid uses:
- to decline, cancel, non-renewal, confirm rating criteria already used in rating (such as miles driven, or garaging region)

Question 4

How to ensure data transparency?

Answer 4

The insured should be able to access their own data and to correct errors in the data.

Question 5

Items insurer must communicate to insured in order to promote transparency. (3)

Answer 5

DISCOUNT:

• HOW to qualify, PERIOD being measured, MIN/MAX discount
• regular FEEDBACK on driving habits
• WHO has access to insured’s data

Question 6

What must all filings clearly indicate? (3)

Answer 6

WHAT IS MEASURED: acceleration/deceleration, speed, distance
HOW IT’S MEASURED: frequency, occurrence, thresholds
DATA: all premium and loss data

Question 7

Ramifications of lack of UBIP data in ON.

Answer 7

FSCO will accept data from other jurisdictions, but filings may take longer to review.

Question 8

How does insurer encourage insureds to adopt UBIP?

Answer 8

Insurer covers all costs of installation, maintenance, operation costs, and must assure the insured that data will only be used to LOWER rates.

Question 9

DATA CONSIDERATIONS (4)

Answer 9

• Termination: ensure no further data is captured, transferred, analyzed after UBIP or policy termination
• Accuracy: compliance with UBIP discount, data ERRORS fixed, customer DISPUTES resolved, customer hasn’t TAMPERED with data
• SECURITY: data capture, transfer, analysis is done in a secure environment
• STORAGE: data deleted, anonymized when there is no longer a clear business need (eg: opt-out, doesn’t renew, data not relevant for discount)

Question 10

Compare and contrast UBIP and Credit Scoring SIMILARITIES. (4)

Answer 10

• relatively NEW
• potentially CONTROVERSIAL (privacy)
• requires CONSENT and safeguards to prevent insurer misuse
• BENEFITS customers (discounts only, no surcharge based on UBIP data)

Question 11

Compare and contrast UBIP and Credit Scoring DIFFERENCES. (3)

Answer 11

• data source: UBIP - device in car; credit score - from credit bureau
• data quality: UBIP - thin; credit score - highly credible
• usefulness: UBIP - TBD; credit score - yes

Question 12

How is competitiveness UBIP marketplace promoted? (2)

Answer 12

• insurer must facilitate transfer of insured’s telematics data to another insurer
• FSCO accepts non-Ontrario UBIP data since ON UBIP data is so thin