Driving a Standard

Significant hurdles have confronted insurers seeking to launch usage-based insurance programs, including a lack of standardization and the threat of patent infringement litigation. But Progressive's recent patent setbacks and ACORD's new data standards could prompt new programs.

May 6, 2014

Chris McMahon

A series of events since the first of the year may offer insurers increased clarity and certainty should they choose to launch usage-based insurance programs. Those programs, also known as insurance telematics, use in-vehicle devices to monitor driving behavior moment-by-moment to rate risk, facilitate underwriting and offer insurance rates based on an individual's actual driving behavior. Insurance industry group ACORD (Association for Cooperative Operations Research and Development) in January published its open data standards for insurance telematics technology. And Progressive Insurance, the leader in the usage-based insurance market and an insurer that has established its own telematics data standards, has endured a series of setbacks in its efforts to delay or deter other insurers from launching usage-based insurance programs.

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