Rakesh Jain, CEO of Reliance General Insurance on how the evolving fleet electric vehicle market is creating demand for specific insurance products.
25 Mar 2024 | 4129 Views | By Rakesh Jain, CEO, Reliance General Insurance
The surge in the adoption of electric vehicles (EVs) in India is unprecedented, aligning with the global push towards sustainable practices. This shift not only impacts the automotive industry but also necessitates a re-evaluation of the insurance sector. As EV fleets proliferate on Indian roads, there is a pressing need ...
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The surge in the adoption of electric vehicles (EVs) in India is unprecedented, aligning with the global push towards sustainable practices. This shift not only impacts the automotive industry but also necessitates a re-evaluation of the insurance sector. As EV fleets proliferate on Indian roads, there is a pressing need for specialised insurance products to address the distinct opportunities and challenges emerging in this evolving business landscape.
The introduction of EV fleets bring forth new set of risks that are not adequately covered by conventional motor own damage insurance policies. They pose unique risks that come as virtue of the product being new and unforeseen, making the role of technology extremely pivotal in shaping the direction of insuring such vehicles. For insurance companies, it is imperative to understand the evolving consumer behaviours influencing usage pattern and associated risks arising from it. A balance amalgamation of EV OEMs and insurance underwriting expertise is essential for understanding EV technology, access risk, and build innovations with effective insurance solution.
Insurers can leverage technology that now plays a crucial role in the symbiotic partnership between insurance and EV. Telematics, the Internet of Things (IoT), and AI-driven analytics are essential components for risk assessment, preventative maintenance, and real-time monitoring. Insurance companies must leverage these technological advancements to offer customised coverage, predictive maintenance programs, and dynamic pricing models. Integrating technology enhances risk assessment accuracy and empowers fleet managers to operate their businesses more profitably and safely.
Understanding how consumers use EV is vital for designing insurance policies that meet their evolving needs. Variables such as distance driven, charging habits, and usage in different environments influence the risk profile of electric vehicles. Equipped with onboard sensors and telematics systems that collect data on various aspects of vehicle operation such as speed, acceleration, braking, battery performance, energy consumption, and vehicle location. EVs are movable data warehouses.
Through data analytics, insurers can gain insights into these usage patterns, allowing them to offer tailored coverage and incentives. Moreover, in alignment with the principles of the electric car movement, innovative insurance solutions can serve as incentives for promoting sustainable practices and safe driving behaviours.
In conclusion, the insurance sector stands at a turning point, marked by innovation and adaptation as India embraces the growth of EV fleets. Crafting specialised insurance products for electric vehicle fleets involves addressing unique risks, navigating evolving legal frameworks, and embracing advanced technologies. The transformative shift towards sustainable transportation requires proactive adaptation from insurers to ensure a seamless transition.
Last but not the least, a combined effort between the automotive and insurance sectors is imperative to safeguard the future of mobility in India as the wheels of progress turn towards a greener tomorrow.
Rakesh Jain is the CEO of Reliance General Insurance. Views expressed are of the author.