The first UBI programme in Germany has a price
The fairly tame German UBI market has just received a shot in the arm with the Sparkassen DirektVersicherung (S-Direkt)/ Telefonica announcement of the first PHYD offer in the country. It is also the first UBI offer in Europe for which some drivers will have to pay a monthly fee.
Launched next week for contracts beginning January 2014, the new UBI proposition from S-Direkt is a nationwide offer directed at the wider market, but with an anticipated stronger appeal to young drivers.
Like its Austrian neighbour, Unika, S-Direkt puts safety first and foremost, with partnerships with Deutsche Assistance for automatic crash notification and Masternaut for stolen vehicle tracking.
S Drive (Sparkassen DirektVersicherung sicherheit telematik service) is very clear on privacy and data protection; while the driver behaviour and location data is handled by the telematics system, only the rating and a customer ID number is passed on to S-Direkt. Thus the rating system is anonymous and the insurer knows nothing of its customers’ whereabouts.
Whilst we estimate that being the first entrant in such a buoyant market will have a positive impact on S-Direkt, the benefits to the customers are more subtle:
– Ecall and bCall: Auto crash detection data is sent directly to partner Deutsche Assistance. To retain data protection, the system sends crash data matched to a customer ID; Deutsche Assistance only then matches this with personal customer information they receive from S-Direkt.
– Driver feedback on a smartphone app: Telefonica has consciously limited the social network aspect of its app at this stage, compared with other markets. Yet the mobile service set includes feedback on the driver’s score as well as LBS services such as “find my car”.
– Discount: good drivers can expect a maximum 5% discount on their premiums at renewal. A secret poll of driver scores is also made, and every month the best driver wins 3 months’ free insurance.
The offer will be available through two channels. The primary is Check24, the biggest price comparator in Germany. The offer is free of charge there, but is only available to drivers with higher premiums. Telefonica expects this will be the primary channel attracting younger drivers.
The offer will also be available on S-Direkt’s website without premium restriction, but at a cost of €5.95/ month + premium. Although paying for safety has never been a sustainable business model, Telefonica believes it could prove attractive to drivers of older cars.