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Unfortunately, this is not an isolated case, because the WSJ's reporting corresponds to what
That's a big problem for auto insurers because
So, when policyholders find themselves broken down on a hot day far from home at the side of a country road, if they end up sweating for hours waiting on a tow operator who gives them no indication of when they might arrive, they're going to be upset. And they're not going to direct their ire at the third-party roadside assistance provider. They'll be angry with the insurer who underwrites their towing and roadside coverage policy. Simply put, long wait times result in lower insurance carrier NPS scores, which hurts customer retention.
To cope with the labor shortage, the
It stands to reason. By taking closer jobs, service providers' trucks assist more motorists and spend less time driving back and forth. However, most motor clubs don't dispatch jobs that way. Instead, they operate on a territory model, where one company has exclusive rights to all jobs in a certain geography. These territories can cover a large area, which means it may take quite some time for a tow operator to arrive on scene. If there are closer jobs, the provider is likely to do those first, because in this way, they can complete more work in a day, and more volume means more revenue per truck.
There is a technological solution to this problem, it's location-based dispatching. In a world where GPS is ubiquitous and smartphones and mobile devices are everywhere, analytics can crunch location data to offer new jobs to qualified tow operators who are closest to the scene. As a result, stranded policyholders get faster service, tow operators get more jobs per day, and auto insurers end up with happier customers and better NPS scores.
Of course, location-based tow dispatching won't completely solve the current problems with tow operator labor shortages and slow response times. But it can mitigate their effects and provide faster response times than would be possible without the aid of this technology. In this environment, auto insurers can use every advantage they can get.