How Allstate Uses Mobile Data To Enhance Customer Experience - InformationWeek
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8/31/2015
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How Allstate Uses Mobile Data To Enhance Customer Experience

Allstate had to stretch its organizational muscles to bring Drivewise Mobile to market. In the process, the company brought together a cross-functional team that included assorted IT disciplines and business professionals with competencies in consumer relationships, insurance products, and user experience.

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Insurance is all about information. When you're one of the nation's leading automobile insurers, the closer your information source is to the cars in motion, the better. That's why Allstate's Drivewise Mobile application is important to the insurer -- and why the program was recognized as one of InformationWeek's Elite 100 for 2015.

Drivewise Mobile is an enhancement of Allstate's Drivewise product, in which customers install a small device that connects to a vehicle's OBD-II port (a port that's been part of virtually every new vehicle sold in the US since 1997). In a phone interview with InformationWeek, Allstate's Chetan Phadnis, vice president for connected car engineering, talked about Drivewise Mobile, its development, and what it has meant for Allstate information technology.

Chetan Phadnis, vice president, Connected Car Engineering

(Image: Allstate)

Chetan Phadnis, vice president, Connected Car Engineering

(Image: Allstate)

From Car to Smartphone

"Drivewise ... is a telematics based insurance program," explained Phadnis. "It basically revolves around information our customers share about their driving behavior. We look at that driving behavior and provide coaching and counseling to them about how to be a better driver. Based on their driving behavior they can either get discounts or awards off their insurance premium."

Drivewise has been in the market for about five years and has been joined by similar products available from other insurers. Phadnis said one thing unique to Allstate is that it was the first insurance company to provide what it calls a "mobile usage-based insurance product." He explained: "We are the first to use the sensor information that comes off a mobile device, a smartphone, and we use that to run our program, provide information to our customers and clients about their driving behavior, and facilitate that through a mobile device."

[ See how companies are turning social media data into dollars and cents. Read 7 Smart Ways to Leverage Social Data. ]

Smartphones and the diagnostic system accessed through a vehicle's onboard device can provide dramatically different information. Phadnis said that each can provide the basic information Allstate needs for its purposes. "With the OBD device, we get data around miles driven, hard braking, et cetera, taken from the car itself. We gather similar data from the mobile device, but it's based on GPS information. And algorithms based around the GPS information can provide insight on driving more than 80 miles an hour, hard braking, and so on."

The Allstate Drivewise device. This device connects to the vehicle's OBD-II port.

(Image: Allstate)

The Allstate Drivewise device. This device connects to the vehicle's OBD-II port.

(Image: Allstate)

Building an App

Insurance companies are known for their sophisticated enterprise data systems, but the skills needed to develop applications for those platforms and keep them running can be very different from the skills required to build an app, especially one that draws heavily from geospatial data. Phadnis acknowledged that Drivewise Mobile took the IT team in a new direction. "If you think about what we sell at Allstate, automobile and homeowner insurance, it's technology intensive. When we moved into the world of the mobile product, it required us to build out skill sets you might see at a progressive technology-based company like an Uber or Google. The product we're making is an insurance product and a digital software product, and it requires competencies and functionalities across the spectrum."

Allstate had a deep bench of talent in computing areas ranging from actuarial science to risk assignment, according to Phadnis. "The things we brought in were more knowledge and experience around consumer-driven mobile product management." As an example,

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Curtis Franklin Jr. is Senior Editor at Dark Reading. In this role he focuses on product and technology coverage for the publication. In addition he works on audio and video programming for Dark Reading and contributes to activities at Interop ITX, Black Hat, INsecurity, and ... View Full Bio
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batye
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batye,
User Rank: Ninja
9/1/2015 | 9:28:36 AM
Re: Allstate
@vnewman2, interesting observation, in Canada we have the same problems drivers in Ontario

use QC addresses to get cheaper insurance...

it would be interestion to know if other countries have the same problems??? please do share :)
batye
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batye,
User Rank: Ninja
9/1/2015 | 9:25:23 AM
Re: Using innovation for better customer satisfaction
@mejiac, it all depends, but I think most of the time smaller players do offer better options... how I see it...

anyone else please do share:)
batye
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batye,
User Rank: Ninja
9/1/2015 | 9:23:27 AM
Re: Allstate
@tzubair, I would say this way we not gonna be paying for a bad drivers, how I see it :)

also hope others could put they two cents in... what you guys/girls think ???


 
batye
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batye,
User Rank: Ninja
9/1/2015 | 9:21:40 AM
Re: Allstate
@Brian.Dean, Interesting point, I would say you are right with numbers

as probability of collisions does increase... 

 I would love to hear what other members think??? 
Brian.Dean
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Brian.Dean,
User Rank: Ninja
9/1/2015 | 2:34:31 AM
Re: Allstate
It is always great to see a business move from the tertiary sector and into the quaternary sector to provide a higher level of service to its customers.

Breaking and speed are important factors that determine the safety of a traveler. I wonder how "time of day" is related towards safety. On the one hand, rush hour would mean that there is a large number of vehicles on the road that in turn would increase the probability of minor collisions. On the other hand, traveling during the night for instance creates an environment to speed.
mejiac
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mejiac,
User Rank: Ninja
8/31/2015 | 11:27:48 PM
Re: Using innovation for better customer satisfaction
DIY @tzubair,

Thank you for your comment. I do have an example of a smaller competitor that's seeking a shot at the big boys. My alarm system is from frontpoint.... where its main competitor is ADT. The reason I choose frontpoint was because of the technology that they use. It's taylore for being a DIY type of set up, and the support and monitoring is A+.

They are I would say maybe less than half the size as ADT and others, but they are making a name for themselves based on the technology platform that they're offering, and a superb customer experience.
tzubair
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tzubair,
User Rank: Ninja
8/31/2015 | 10:24:21 PM
Re: Allstate
"If All State found out you never set foot in Pennsylvania, but "lived" there, you'd be in a load of trouble.  Lucky for them this isn't a mandatory program yet."

@vnewman: I agree. I think the best part is the fact that it will give a chance for All State to be ahead of others in terms of their profitability. If they can recognize this, it will prevent them from ensuring such people or charging the right premium from them. Hence, they'll be spending less when it comes to servicing the claims leading to a higher profitability.
tzubair
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tzubair,
User Rank: Ninja
8/31/2015 | 10:16:23 PM
Re: Allstate
 

"People know the info comes from their car itself, so they don't have to worry (so much) about taking Allstate's word for it. Great move."

 

@Zerox: I think the best part is the fact that people would not longer have to pay a higher price for the preimum just because it is being calculated on an average basis. If the data is for individuals and is personalized, there's always a chance I'll be paying the right amount that I deserve to and not an amount which is an average or based on assumptions.
tzubair
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tzubair,
User Rank: Ninja
8/31/2015 | 10:09:35 PM
Re: Using innovation for better customer satisfaction
"When a company decides to use technology as a driver for business strategies...that's were innovation takes place... kudos to All State."

@mejiac: I think that sets an example of a situation where you can use technology to set up your own competitive advantage and get ahead of the competition esp when the market is getting tougher and it is becoming increasingly difficult to survive. Particularly, if you're a smaller player in the market competing against the giants, this can prove to be very effective.
vnewman2
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vnewman2,
User Rank: Ninja
8/31/2015 | 6:49:52 PM
Re: Allstate
Well said @Zerox203 - It really is a mystery for plenty of folks until, of course, they have an accident and find out the hard way. 

I was also thinking how this device could be used against the insured.  When I lived in Pennsylvania, plenty of NJ residents (where car insurance is one of the highest in the country) would find a way to "live" across the Delaware by listing their friend's or relative's address as their home.  If All State found out you never set foot in Pennsylvania, but "lived" there, you'd be in a load of trouble.  Lucky for them this isn't a mandatory program yet.
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