Sherezad Rehmann, Senior Director of Global Product Management, and Martyn Mathews, Senior Director of Personal Lines Insurance, U.K. and Ireland, LexisNexis Risk Solutions
As nations globally instigated lockdown measures to control the spread of COVID-19, private cars largely went unused for weeks on end. The annual motor insurance premium calculated on a range of factors such as where the policyholder lives, their age, occupation and engine size could not factor for this sudden and prolonged change in risk. Insurance providers offering telematics or usage-based insurance products had insight the rest of the market could only guess at with reports of traffic volumes falling between 70%-85%[i].
The pandemic has highlighted the value of static and dynamic vehicle data in understanding risk, delivering a fair and accurate premium and giving motorists more flexibility and control over their insurance costs. Rather than rely on estimations and proxies for risk, it could tell an insurer the car’s mileage (valuable insight during and post-pandemic), the car’s position, how it is driven and the Advanced Driver Assistance Systems (ADAS) features on-board and activated to enable the development of more personalised, more engaging insurance cover.
This isn’t visionary, the insurance and car manufacturing markets were coming together to make this concept a reality, well before the emergence of COVID-19.
By 2030[ii], all new vehicles are expected to have connectivity feeding a wide range of data to car manufacturers. Carmakers have invested significantly in connectivity as part of their drive to provide a greater choice of mobility solutions to help improve the customer experience. Data from the car can help them understand exactly how their vehicles are used and how they can cut the cost of ownership as they invest in developing increasingly autonomous vehicles as part of their zero emissions and zero fatalities objectives. C.A.S.E., or Connectivity, Autonomous, Sharing/Subscription and Electrification, is being used as the guiding principal for the future of the auto industry.
In parallel with the development and increasing market penetration of the connected car there is a recognition amongst insurance providers that they will need access to vehicle centric data to support the provision of usage based insurance.
It is as much in insurers’ interests to understand more about the car as it is manufacturers. Consumer expectations were already changing prior to the pandemic, but the demand for more personalised products looks set to increase. Vehicle centric data has the potential to help price insurance more fairly, cut claims costs and deliver new services such as Pay As You Drive products.
The big question has been how to bring these two major industries together so that insurance providers can access connected car data in a way that adheres to data privacy and security regulations as well as making sure that the data is useable and meaningful for insurance. How do you ensure Mrs Smith driving her Fiat 500 is given the option to share her driving data for insurance and this will be understood in the same way as her neighbour driving a completely different car? When you think about the volume of car makes and models, the number of motor insurance providers, the quantity of motorists buying insurance it becomes a big ‘many to many’ problem.
The solution lies in a data platform strategy that takes all the strands of vehicle centric data – so telematics data from any device or app, data from the connected car and vehicle build data and putting it into an environment where it can be standardized, contextualized, normalized and scored in a fully compliant manner for use across a variety of vehicle makes or models. This is one big data project that could have a profound impact on the future of mobility.
The starting point goes back to the investment car makers are putting in vehicle autonomy with ADAS (Advanced Driver Assistance Systems) increasingly available in vehicles and constantly being enhanced. SMMT research shows 8 in 10[iii] new cars in the UK have driver assistance systems and over half have adaptive cruise control. In the US, LexisNexis internal analysis shows 76% of
2019 models had at least one core ADAS feature, which is up significantly compared to 18% in 2014[iv].
To date, it has been a challenge for insurers to identify exactly what ADAS features a specific vehicle is equipped with when writing a motor insurance policy. This is because each car manufacturer has created their own unique terminology, definitions and naming structures – sometimes releasing multiple features within the same model year. In addition, many items are chosen as optional extras when a vehicle is purchased from new.
To address this challenge, data scientists at LexisNexis Risk Solutions have developed an ADAS classification system using machine learning to scan millions of lines of car manufacturer vehicle data to logically sequence and classify vehicle safety features and component’s intended operation or purpose.
This classification system provides the foundation for LexisNexis Vehicle Build. Access to vehicle safety data will help insurance providers factor for their presence throughout the customer journey – in pricing, mid- term adjustments and renewals – and establish the differences in risk profile associated with the vehicles that have these safety features.
Access to vehicle safety data will help insurance providers factor for their presence throughout the customer journey. It will also enable them to understand how specific safety features behave, for example if a feature will provide an alert or warning to the vehicle’s driver when a potential danger or hazard is detected. It will also allow insurers to understand the purpose of features.
At the same time, car manufacturers will be able to see what ADAS features have the most impact on their customer’s safety to help drive further enhancements.
As carmakers and insurers get a better understanding of the vehicle, how it’s driven, its performance and how semi-autonomous features work in the real world, consumers will also learn how data from and about the car can work for them. This will support market adoption, drive innovation and help create more benefits in terms of safety and total cost of ownership.
Safer cars, safer roads, lives saved, fairer more flexible insurance cover – the value of vehicle centric cannot be overstated and we’re already well on the journey to enable motorists to truly benefit.
[i] Source: LexisNexis Risk Solutions and Autosaint Analysis – March-June 2020
[ii] LexisNexis Risk Solutions Research of the Automotive market conducted in 2018
[iii] Source: Society of Motor Manufacturers and Traders: https://www.smmt.co.uk/wp-content/uploads/sites/2/SMMT-Motor-Industry-Facts-JUNE-2020-FINAL.pdf
[iv] LexisNexis Risk Solutions Analysis conducted in 2019
THE TOP 5 CRYPTO EXCHANGES IN THE WORLD YOU SHOULD KNOW ABOUT
Crypto Exchange is a very important part of the Cryptocurrency EcoSystem. Crypto exchanges are the platform where transactions take place. You can also purchase Bitcoins in crypto exchanges.
It is a marketplace in the digital sphere that allows traders to purchase and sell Bitcoins. Do note that fiat currencies and altcoins can also be used in crypto exchanges. Since you have clicked on the link to this blog, there is a high chance you are a Bitcoin investor, or you are someone who likes to keep a keen eye on the crypto space.
And why should you not? Given all the buzz that cryptos are making in the financial markets. Bitcoin is the most famous cryptos, so I will be talking only about bitcoins in this blog for the sake of convenience.
Crypto Exchanges 101
A Crypto Exchange’s primary objective is to act as a broker and bring a buyer and seller to one place. It is pretty much like a traditional stock exchange; the only difference is that everything related to crypto exchanges happens digitally.
However, the process is not that different. On Crypto exchanges, traders have the option to sell and buy Bitcoins after inputting a value or order. When a trader selects the market value, the crypto scans the best market value available for the Bitcoins and presents it to the trader. Visit daily profit to start investing.
In order for a trader to transact in bitcoin, he needs to get himself signed up with the exchange platform. And then go through the various amounts of verification procedures. Once the trader has successfully verified his identity. He can start trading. But before that, he needs to transfer his fiat currencies to Bitcoins, and only after that, he can buy Bitcoins.
The currency exchange methods vary from exchanges to exchanges. Some allow users to transfer it via wiring through the bank; some well-established exchanges allow a direct transfer from the bank. Some allow the use of credit and debit cards.
Features of a Crypto Exchange
Crypto Exchanges have a lot of features that will ease up your transaction process.
- Crypto Exchanges are decentralized – Decentralised means it operates without any governing body. There are no intermediaries in between. It offers peer to peer trading without having to show an account of your spending to the regulatory body.
- Low Processing Fees – As crypto exchanges are decentralized, it is a peer to peer connection.
The Top 5 Crypto Exchanges In The World You Should Know About
There are more than a thousand crypto exchanges; trying them out one by one will take a lifetime. So as a crypto investor, I have personally selected the top five most popular crypto exchanges that you ought to know about.
The most widely used Crypto exchange on the face of the Earth is Gemini. It is perfect for all the major cryptocurrencies, but when it comes to Bitcoins. The only little drawback that I find in Gemini is that it asks for way too much personal information.
Etoro is more of a financial trading service than an actual crypto exchange, but it is worth talking about nonetheless. Crypto investors hold this app in high regard; it has a very good reputation. It has very high processing fees, which may annoy some traders.
When it comes to security, none can match Kraken. Apart from that, it has a very big user base. And it also charges very low transaction fees. A handful of traders do not like Kraken as it does not offer the best customer support services.
Unless you had been living a rock, you must know Binance. Binance is the go-to crypto exchange. You get to see the ads of the Binance app over the Internet a lot. Binance gives you the added advantage of trading huge amounts of cryptos in a single time. Binance is only meant for experienced traders. It is not recommended for newbies.
Coinmama offers very strong security. The UI is user friendly. The best part is the customer support. I personally like Binance the most because it takes a step further and makes sure that proper security measures are implemented and add to that its classy user interface.
Many traders may not like Coinmama as the significant-high processing fees.
There you go, there was the list of top 5 crypto exchanges. Please invest your money at your own risk. You should have a very strong knowledge of the crypto market before investing. Otherwise, you may face huge losses.
FIVE TRENDS THAT WILL IMPACT THE FINANCIAL SERVICES INDUSTRY IN 2021
Ian Johnson, Managing Director Europe at Marqeta
Coronavirus has shaken things up across all industries, and financial services is no different. This year, we are likely to see a much more risk averse industry, as fintechs and banks alike move into survival mode. Yet, this will also spur innovation. The shift away from cash will give a shot in the arm to digital payments, while lenders in particular will have to get creative to balance their risk against the need to dispense funds.
It’s likely to be an interesting, albeit bumpy, year. Here are five core trends that I see having a major impact in 2021.
Lenders will seek improved visibility to combat delinquency
An economic downturn unfortunately means higher delinquency rates for lenders. But businesses – in particular, SMEs – need liquidity to survive, now more than ever. To balance risk with need, more lenders will focus on enabling visibility and control after a loan is dispensed. Instead of issuing funds to a bank account, loans will be dispensed to virtual cards or wallets, allowing lenders to track exactly how and where money is spent. This way, lenders only release funds as they are needed – rather than in one lump sum.
They also have the power to approve or reject payments in real-time, based on whether the request is aligned with the terms of the loan agreement. For instance, if a company has secured a loan for IT equipment, but attempts to spend it on office refreshments, the lender can make an instant decision to permit or deny the transaction based on geolocation and other transactional data. So, borrowers should ready themselves to be much more transparent if they want to secure loans in the future.
Embedded payments to become more commonplace
Embedded payments has been around a long time – just look at pioneers like Uber, where payments are so integral to the customer experience that it doesn’t even feel like you’re paying anymore. In the next year, we will see this expand, with a wider variety of organisations making payments a core element of their customer experience strategies. This trend will be coupled with a shift towards transparency and privacy, where people willingly exchange their data for an improved, personalised experience.
This is something consumers do readily in many areas of online life already – shopping, social media, and so on. In 2021, we will see more banking and payment services operating off the back of this same exchange. In return for data, customers will be given smoother, more tailored payment experiences.
Use of cash to drop below 15%, falling from 23% of all payments in 2019
The UK and Europe’s departure from cash will continue to evolve into next year. Physical cards will begin to give way to a rise in digital payment methods – virtual cards, digital wallets, and the likes of Apple Pay and Google Pay. Banks will need to prepare for this shift; hopefully learning their lesson from the early months of the pandemic, where 88% were overwhelmed by demand for online and mobile banking. This means modernising behind the scenes, using technology to improve and streamline payment processing. Time and money also need to be invested into educating and supporting businesses and individuals that going cashless could leave vulnerable, such as small merchants and elderly people. Until this has been addressed, going cashless risks leaving the most vulnerable in our society behind.
Back-end bank modernisation set to continue
Traditional banks recognise that they need to be able to innovate faster, particularly on the front-end, to compete with the new waves of digital banks and fintech entering the market. While we will see continued modernisation on the back-end, as they try to unpick the complex web of legacy systems they sit upon, I would not expect this issue to be fixed in a year. Instead of taking on the risk of full migration, many banks will ‘hollow out’ certain services – leaving core services in place that are too risky to move, whilst shifting newer services onto more modern platforms to avoid coding them into legacy systems.
This will create the building blocks to build a standalone digital bank within a bank, allowing them to modernise the entire stack and then incentivising customers to make the switch. An example of this approach is Goldman Sachs’ digital bank Marcus, which has debuted to strong demand – it’ll be interesting to see if others follow suit.
Alternative lenders will open up the market to support post-COVID-19 recovery
The process of securing a loan has always been quite painful – involving lots of self-reporting, paper statements and credit reports. And it could take days to find out if you were successful and then even longer to access the funds. Thankfully, it is looking like those days might be coming to an end with the emergence of a new breed of alternative lender focused on transforming specific niches of lending. Take SME lending, which has traditionally been regarded as high risk/low rewards and neglected by traditional lenders.
New alternative lenders, such as Capital on Tap, are changing the stakes. Using data and modern payment platforms, they are able to make loan decisions in minutes, not months. We are seeing the same in Point of Sale lending with companies like Klarna – now, you can apply for a POS loan and get approved in seconds. These companies will set the standard in terms of expectations around lending, forcing bigger lenders to follow suit and helping to transform the loan experience.
Fintechs to continue leading front-end innovation
Fintechs hold the monopoly on defining what ‘good’ looks like in terms of features. From money management tools, to saving incentives, fintechs have the agility to create new, attractive products with a speed and creativity that traditional banks simply cannot match. However, true success stories of fintechs paving the way to long term profitability are rare. Established, traditional banks still hold all the capital and most of the main checking accounts, making it harder for fintechs to really get ahead. This is likely to continue into 2021, but we are seeing signs of convergence, with fintechs acting as the front-end for customers while banks provide capital in the background.
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