The Carro IQ device uses data analysis that can easily calculate the age of the vehicle.
Insurance companies often solve car ownership problems with several solutions. However, when consumers’ needs change, they also demand services that are more flexible and affordable. They responded to the challenge and created a solution through a product, called Covered, which was launched by the South East Asian car market.
Covered is Singapore’s first artificial intelligence (AI) pay-per-mile insurance and maintenance plan. The objective of this insurance plan is to offer drivers premium, tailored insurance and maintenance coverage that adapts to their lifestyle. It all helps them get a car insurance plan that best suits their needs.
Distributed by Genie Financial Services, a subsidiary of Carro, and backed by NTUC Income, available for all types of cars, including electric vehicles (EVs). Fully digital and contactless coverage. Customers only need to complete the information through the website to receive a quote from Covered and pay an annual coverage fee of S$150 upon receipt of the quote. They will then be sent an installation guide and the Carro IQ kit, the on-board telematics unit run by Carro’s technology partner, Quantum Inventions.
Once the device is installed, it will begin tracking odometer data, which will be used to calculate insurance and maintenance costs based on usage. The data will be verified and verified by QI’s scalable Fleet Mobility and Data Platform (FMDP) to ensure fast and accurate calculation of information and alerts. Rates per kilometer are determined by the applicant’s age, vehicle type and driving experience, with an average rate of 12 cents/km.
To learn more about Covered, Insurance Asia spoke with Aaron Tan, CEO and Founder of Carro.
How is this product formed?
The collaboration began with the desire for NTUC Income to be launched as a complete solution for its clients. Launched to be Singapore’s first usage-based insurance plan to use an AI-powered pay-per-kilometre plan. This product covers insurance per kilometer and maintenance per kilometer, being the first of its kind on the market.
With the help of AI technology, the driving kilometers of the car’s life and how much the driver will spend on maintenance can be easily predicted. The reality is that many drivers often pay more than they are asked or what they will use over the life of the car.
Carro saw this as an opportunity to create a solution that could solve all problems in a single product, from insurance to maintenance to downsizing, things that are not common in other offerings. Traditionally, insurance plans only cover auto warranties, but our goal with Covered is to provide customers with a convenient, transparent, and hassle-free product that fits their lifestyle.
How did NTUC Income get involved in this project?
NTUC Income needs partners with the right technical skills to match insurance and maintenance premiums to customers’ lifestyles on a digital platform. This is where Carro comes in, where we leverage technology and analytics to enable customers to enjoy significantly more by tracking their mileage and calculating their premium for the month.
Additionally, NTUC Income needs partners who can easily adopt their digital transformation office into existing systems. Not many companies in the market can directly join the API like NTUC Income did. Even if companies have such a complex system, they do not have channels to market the innovative product.
What is the basis for the annual coverage of S$150? Can you provide more details on how the premium will be calculated?
An annual coverage fee of $150 is based on the NTUC Pre-Insurance Payments Income Policy, which is a regulatory requirement to implement insurance plans. In addition to maintenance, there are also incidents such as hit and run, fire, and theft, which are often classified as minor events.
How can this product help the most difficult drivers, especially since they don’t have to commit to high excesses compared to most traditional auto insurance?
Covered has a zero deductible policy which is a unique policy in the market. this means when like, If the driver has an accident, they are expected to pay no additional fees to a third party and can replace their car parts or have it repaired at a cost.
Popular concept among the older generation as they prefer to have everything covered under one insurance plan, where reporting and servicing can be done easily under one roof.
Plans like Covered are usually preferred among younger drivers who prefer not to commit to high-excess, which requires significant cash. Covered is the only product on the market today that doesn’t offer customers high advantages.
What are your customers’ reactions to Covered?
The response has been overwhelmingly positive — they appreciate simplicity and the idea of being fairly billed. When Carro tracks the driving behavior of users and the distance achieved via telematics, customers can experience transparency about how much they are applied based on their driving and lifestyle.
Using telematics, Carro strictly charges month to month, instead of paying fees upfront and then refunding them when they don’t meet distance requirements. This allows for fairer and more transparent pricing as drivers are charged based on the exact mileage, up to a certain kilometer. For novice drivers who tend to have a high or high overload and have no knowledge of how insurance services work, Covered’s service is about giving them a thought-provoking solution.
Since Singapore has banned fuel-engined vehicles by 2040, are you making adjustments to that or making more products for EVs? If so, how is it different from your current product?
The EV movement in Singaporea is very exciting, and I think it’s amazing that the Singapore government is pushing for a clean transportation system. To strengthen this long-term investment, Singapore is tracking policies and initiatives such as the internal combustion engine (ICE) vehicle by 2040, the 2030 Green Plan, with which it is predicted to be a key economic theme for many moving forward. As ICE vehicles are being phased out, we anticipate the demand for ICE cars will fall while the popularity of EVs will slowly increase.
As an automotive technology player, Carro’s role remains the same. We will continue to leverage technology and work closely with our partners to support customers to make greener and wiser choices. We’re likely to see more activity on our platform before the end of the trial, where ICE vehicles are listed for sale at a lower price. We predict that by 2035, most of the cars sold at Carro will be EVs.
What’s Covered’s next plan? Are you planning on expanding this at a later time?
The plan for Covered is to further boost adoption growth in Singapore in the next few months. We believe that customers have the right to more transparent pricing, especially in terms of insurance and financial schemes. We hope to expand to other markets in the future, one of which is Indonesia which will be covered.