How Agents Can Turn Technology Into a Customer Conversation
Valerie L. McGehee, PhD
For insurance agents, telematics is more than just explaining technology. It helps
customers see how it could affect their driving, how their risk is measured, and possibly what they
pay for insurance.
For a long time, auto insurance prices have mostly depended on who the customer is, what kind of
car they drive, where they live, and their past history. Insurers use things like driving records,
claims, and vehicle details to figure out risk.
Telematics adds something new by showing how a car is actually driven.
Depending on the technology and program, usage-based insurance may collect information such as
mileage, time of day, acceleration, braking, cornering, and other driving behaviors. Insurers can
use this data to price coverage more closely to how someone actually drives.
But for agents, the technology itself might not be the most important part to discuss.
The real question is how to talk about telematics so customers can make informed choices.
Start With the Customer, Not the Technology
Mention “telematics” to a customer and you may immediately get questions.
- “You’re going to track me?”
- “What information can the insurance company see?”
- “Can this make my insurance more expensive?”
- “How much could I save?”
Agents shouldn’t avoid these questions. They are reasonable and answering them clearly
helps build trust.
Rather than starting with how the technology works, begin by explaining why the customer might be interested.
A better opening might be:
“There may be an opportunity for your driving habits to help you qualify for savings. Would you like me to explain how the program works?”
Now, the conversation shifts from installing an app or sharing data to whether this insurance option is right for the customer.
Don’t Sell the Discount. Sell Understanding.
A common mistake agents make is focusing only on the possible discount.
Savings matter, but telematics programs can vary widely by insurer and state. What is tracked, how the data is used, and how it affects premiums can all vary. Regulators also see privacy as a key issue with telematics and usage-based insurance.
This means agents shouldn’t promise a specific result. Instead, their job is to help customers understand the program. Before recommending telematics, an agent should be prepared to answer four questions:
- What information is collected?
Be familiar with the specific program. Don’t assume all telematics products track the same things. - How is the information used?
Customers need to know if and how their driving data could change their price. - What is the potential benefit?
Explain any savings for enrolling or participating, but don’t guarantee results that depend on future driving. - What control does the customer have?
Be ready to explain how to enroll, what’s required, privacy details, and other terms specific to the program.
When customers are informed, they are more likely to see telematics as a choice, not something forced on them.
Privacy Questions Aren’t Objections, They’re Opportunities to Build Trust
Privacy is one of the most important issues surrounding telematics. The NAIC notes that tracking mileage and driving behavior has raised privacy concerns, and some states have established requirements concerning disclosure and data collection.
Agents should take that concern seriously.
If a customer asks, “Are they tracking where I go?” the answer shouldn’t be a generic yes or no. The right answer depends on the specific telematics program.
Try:
“That’s a good question. Let me explain exactly what this program collects and how that information is used so you can decide whether you’re comfortable participating.”
This kind of answer is important because it gives the customer control over their decision.
Trust is built by answering tough questions honestly, not by avoiding them.
Help Customers Think About Their Driving Habits
Telematics also opens the door to a new kind of insurance conversation.
Instead of just asking about accidents and tickets, agents can encourage customers to think about their daily driving habits.
- Do they drive relatively few miles?
- Do they generally avoid hard braking and rapid acceleration?
- When do they typically drive?
- Are they comfortable using an app or other technology while participating in the program?
Telematics can give feedback that helps drivers notice their habits. Research from the Insurance Information Institute shows that many people made safety changes to their driving after joining telematics programs.
This shifts the conversation from just asking, “How much is my insurance?” to thinking, “Is there something about my driving that could help me?”
The Agent’s Role Is Becoming More Important, Not Less
Insurance is becoming more digital. Customers can now get quotes online, manage their policies with apps, and talk to carriers without visiting an agency.
It might seem like technology makes agents less important.
But I think the opposite is true.
As insurance gets more complex, people who can make it easy to understand become even more valuable.
Customers don’t need their agent to explain every technical detail about telematics. They need someone who can explain what the program means for them.
That’s an important difference.
The best agents do more than just sell policies. They help customers understand their options, weigh the pros and cons, and make better insurance decisions.
Telematics gives agents another chance to do just that.
Agent Takeaway
When talking with customers about telematics, keep the conversation simple. Explain how the program works, what the potential benefits are, and how their driving information will be used. Be upfront about privacy and avoid promising savings that may not materialize.
Most importantly, listen to the customer. Telematics isn’t the right fit for everyone, and the conversation should focus on whether it makes sense for that individual driver, not on selling the technology.
Insurance Insights is an educational resource from AssuranceAmerica Academy designed to help insurance professionals stay informed about industry trends, strengthen customer conversations and continue developing their careers. Valerie McGehee, PhD is Vice President of Strategic Partnerships & Corporate Affairs at AssuranceAmerica.