As interim chief strategy and innovation officer for CSAA Insurance Group, Marik Brockman is tasked with separating hype from reality when it comes to the future of the insurance industry. He spoke to INN about the technology trends that the Walnut Creek, Calif.-based company believes will truly disrupt personal lines P&C insurance.
INN: How did you end up in the insurance industry?
Marik Brockman: My time in insurance began after business school, when I took a position with Diamond Technology Partners, which was later acquired by PwC. I joined CSAA in the fall of 2013 to create the strategy function.
INN: What’s the major charge of your group?
Brockman: We have absorbed the business development group and created an innovation acceleration group. We’ve ramped up everything we’re doing in partnerships and strategic investment.
INN: What trends are you responding to as you establish strategy?
Brockman: We see insurance really getting more connected. You can interact in different ways with your policyholders, like with smart home devices or in cars with their telematics devices. A mobile app used to be something people ignored; now it’s a must-have, because through your app, you can be a partner in people lives. We see insurance evolving to something that’s more risk prevention; rather than just indemnifying people for things that go wrong — we can prevent those things.
INN: How is CSAA leveraging usage-based insurance?
Brockman: We have our usage-based insurance product in-market. We’re rolling out to 16 states, and the take-up rate has been positive in the markets where we started it. We have additional telematics offerings for safe driving alerts out as well.
INN: How does CSAA collect the data for your UBI initiative?
Brockman: We are using on-board devices for now. But we have a roadmap that includes mobile telemetry. We want to understand if it is more accurate and convenient. And, we of course see ourselves collecting data from the car’s own technology eventually.
INN: What’s your strategy for scoring telematics data?
Brockman: One thing we did was insource the data, the collection analysis and scoring. There are parties between the device and the insurer that score the data. But we found there were discrepancies between what we got in terms of results and the scoring.
INN: Are on-board devices likely to remain preferred by insurers?
Brockman: There’s so many applications trying to go after the OBD-2 portal. For example, in the state of Oregon, [connected car technology startup] Automatic Labs is going to launch a pilot that allows people to pass the state smog test without going to a smog check station. That’s a lot of competition. So you have to look around.
INN: Are you preparing for a future where autonomous cars are a reality?
Brockman: We are looking for ways in which we can be a partner [with the autonomous car sector]. The next decade is going to be interesting with different levels of autonomy on the road. We see companies talking about skipping level three, which allows the driver to take over the car at any point. But some people say they’re going to go right to level 4, which is full autonomy. (Editor’s note: These classification levels are from the National Highway Traffic Safety Administration and were released in 2013.) So often, the thing you were trying to get used to is already out of date.
INN: What other impacts are insurers seeing from connected technologies?
Brockmann: We are working with connected home device makers on getting devices into homes, and educating policyholders on options in connected home. We see home insurance as an important growth area.
INN: Do you feel like more of your customers are willing to take on new technology as it relates to insurance, because you’re located in the Bay area?
Brockman: Well, the interesting part of autonomous cars is that it’s in the news every day. The Bay area is full of early adopters. The one thing our location allows us to do is see a lot of startups. It’s nice that they’re right across the street and we don’t have to send a delegate.
INN: What advice would you give other insurers about working with those startup companies?
Brockman: Insurers should go and be active partners. Or even try some of their own ideas. There’s absolutely no reason anyone in the insurance industry couldn’t launch a peer-to peer-product tomorrow. It’s basically innovating their own future.
