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Amodo: Enabling insurers to launch Usage Based Insurance programs based on behavioral data

Written by Roger Peverelli and Reggy de Feniks - Founders The DIA Community on Dec 16, 2020

Customer preferences are constantly changing, even more so during times of disruption, like we’re experiencing now with the global pandemic. Customers, across all domains and industries, are more focused on getting good value for money – and their current perception is that in Motor Insurance, they’re receiving less value, while paying the same amount. How can insurers best respond to this development and offer their customers better value for money?

This is where Amodo comes in – helping insurers and brokers better address and fulfill customer needs by launching Usage Based Insurance Products, based on customer behavioral data. Amodo has created a modular, configurable and robust telematics technology platform, used by many leading insurance companies around the globe. Some of Amodo’s clients include AIG, Porsche Insurance, BNP Paribas Cardif and many more. The Financial Times has named Amodo as one of the Top 5 Most Innovative Insurtechs worldwide.

How it works
Amodo helps insurance companies to address new market trends and opportunities by enabling innovative and quick-to-market smartphone-based insurance products. The platform gathers behavioral data from various data sources, consolidates and analyses it – and then presents it in a user-friendly and actionable way. The platform has been created so that the various behavioral aspects tied to risk are being considered, while determining the risk pricing.

By leveraging powerful telematics sensors in users’ smartphones, Amodo’s connected platform enables insurers to deliver tailor-made, usage-based insurance products. Usage-based products are divided into two models: Pay-as-you-drive and Pay-how-you-drive models. The Pay-as-you-drive offers products like Pay-per-Mile, where the user policy price depends on the mileage. The Pay-how-you-drive model has a scoring system, that gives a score based on the driving style, where safer drivers can benefit from discounts.

With data being the crucial ingredient for this type of insurance products, it is essential that customers are willing to provide their data. This makes customer engagement a critical success factor. That is why Amodo has put a lot of effort into building efficient and automated customer engagement technology. The smartphone app plays a crucial role, both in collecting user behavior data, but also in communicating with the customer.

Innovation behind the app: segmentation and customer engagement to change customer behavior
The Amodo app allows insurers to always be part of their customers’ life. They get to know their customers and their behavior, based on the data being shared through the app. At the same time, the app provides insurers with a direct communications channel. Insurers can send promotional messages through the app, but also alerts through push notifications, if there is important information to share. This allows insurers to maintain contact and build stronger relationships with their customers. The real innovative part of Amodo’s offer actually happens behind the scenes: the segmentation and communication options. Insurers can segment their customers based on the differences in their driving behavior.

A good example is excessive braking: through the app insurers can easily identify customers who brake more than average and send them a warning or educational message to mind their braking habits. This could be the start of further communications with the customer, including cross-sell offers, all based on the customer’s behavior.

An important element of Amodo’s approach to increase customer engagement and change customer behavior, is gamification. Within the app, insurers can create different tasks and rewards to engage users and influence their driving style. Users can complete specific objectives in a goal-driven game and win different rewards. These actions lead to stronger user engagement, and, more importantly, risk prevention by promoting and rewarding safe driving behavior.

From claims optimization to risk prevention
With insurers shifting their focus from claims optimization to risk prevention, Amodo is well positioned to support this shift. Risk prevention is all about behavior change – and changing behavior starts with strong customer engagement. This is a very powerful aspect of the Amodo technology, which has helped insurers achieve impressive and measurable results. Across their client base, use of the Amodo technology has resulted in claim reduction ranging from 15% to 25%.

Amodo helps insurance companies make the shift from risk pricing, based on demographic data to risk pricing based on actual behavior data; as well as the shift from fixed pricing to usage-base pricing. The behavioral data collected through Amodo, offers insurers the opportunity to develop new products, differentiate themselves on the market and gain more traction.

Who is Amodo?
Amodo was founded in 2013 in Zagreb, Croatia, by senior executives from telco and marketing industries. Amodo raised 5M USD investment from investors such as Speed Invest, Lead Ventures, SGH Capital and Bee Next. The initial investment supported Amodo in building their platform and technology and acquiring a great customer base with clients like AIG, Porsche and BNP Paribas. Amodo now has clients in 20 countries across 5 continents.

“The main motivation to build the Amodo Connected Insurance Platform was the obvious gap between customer expectations and what insurance products and services deliver. While customer expectations are changing quickly and are shaped by influences from other industries, the Insurance industry had difficulty catching up in transforming itself. And now, due to the COVID-19 pandemic, the behaviors of vehicle owners are changing even faster. With our Amodo platform we can help motor insurers tap into this changing behavioral pattern and develop new insurance products quickly and successfully.” Marijan Mumdziev, CEO at Amodo.

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