Norwich Union has implemented a 100TB data warehouse to support the launch of the UK’s first pay-as-you-drive insurance policy.
The new scheme uses an in-car GPS satellite tracking device to collect data that allows the insurer to send customers itemised monthly bills with premiums for each journey based on road use.
Information is collected, stored and managed in a 100TB-capacity data warehouse provided by supplier Teradata.
‘It was the first time we had dealt with this sheer amount of data and we have had to build a new data warehouse,’ said Norwich Union’s product development manager Sue Rowland.
‘Storing the data, turning it into a monthly bill, and the necessary summaries and calculations meant a new infrastructure was required.’
The data can also be combined with other information such as traffic data to customise the product to consumer needs.
The technology allows Norwich Union to offer a completely different type of insurance, says Rowland. The new policy will also help motorists control the cost of insurance by making choices based on the time of day, type of road and mileage.
‘It allows customers to control costs by changing their behaviour if they want to save money,’ said Rowland.
‘We are also installing an assistance button with customers who opt for pay-as-you-drive, which uses standard mobile phone technology and opens up a phone line directly to our call centre,’ she said.
Norwich Union has been piloting the project since 2004, with 5,000 customers recording data on 100 million miles from more than 10 million trips. The insurer now expects data collection rates to increase 15-fold in the first year.
‘We tested young drivers because they have an issue with high insurance charges so we wanted to find ways to help them,’ said Rowland. ‘On average, they saved 30 per cent on their premium.’
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