Could Big Data Help You Get Cheap Auto Insurance

Every day we hear that this new thing will revolutionize the way certain industries work. It will make our lives better and easier. Bit data is something that can work both ways. When further information sheds light on a bad situation it will only intensify its negative sides. On the other hand, highlighting a driver’s positive points may help to get cheap auto insurance from most providers because of an improved risk profile.

Information Hungry Vehicle Insurers

They love to get their hands on every little data that will help them fine tune their underwriting process. That is why they are known to be very keen to incorporate big data into their claim prediction and premium calculation process. It is expensive to gather the information, program computers to process it and figure out how to use it. But if anyone has a deep enough pocket, they would be the ones.

Big Data for High-Risk Drivers

The point is that car insurance companies can tell who is high risk because currently they can gather and progress enough information about your car’s safety features, your recent driving record, crime figures in your zip code, your credit score and they can even tell that a certain occupation may make people high or low risk.

Big data will only give them more information to judge you with. Once it is bad it will probably get worse when they can look even deeper. So, it is probably not going to help everyone. If they can have laser sharp predictions as to who might have a claim in the near future it may not be good news for someone who is living in a high crime neighborhood and currently having money issues.

Big Data for Good Drivers

One interesting phenomenon about cheap car insurance is that you can get it if you are pretty low risk and therefore every company is willing to sharpen their pencil to get you. They know that you will probably get better quotes and they must do their best to be in the mix to sign you on.

On the contrary, they would actually jack their rates up to make sure they don’t end up with a troublesome policyholder when they come across a driver with recent claims, traffic violation tickets and bad credit. They don’t want to end up being the ones who will have to settle large claims shortly.

So, it is fair to say that any further information would only help someone who has nothing to hide and there are too many good qualities to list. If all that can be added up and premiums calculated accordingly you would be a winner.

However, it may be too early to count our eggs because companies would first want to make sure that they get the most out of any new advantage and use it to make more money, rather than to help more policyholders get lower automobile insurance rates. Once the rest of the industry catches up with them, they would lose this advantage. Then it may be time to come clean and do good.