It is common for insurance companies to offer discounts for safe drivers.
Normally, that data is collected after an insurance company acquires a customer. Sometimes they give a driver a device for their car that records their driving habits – including their speed, acceleration, hard braking and distracted driving. If the driver reaches a safe threshold after a longer period of time, he will receive a discount.
But what if insurance companies had this data before they brought in a customer? What if they could offer a discount because they already knew someone was a safe driver? Better yet, what if the classic predictors such as credit score, age, and zip code played no role in the price of a person’s insurance, and instead, a driver was judged solely on their current driving habits?
That’s exactly what Arity is doing.
Founded by The Allstate Corporation, Arity is a mobility data and analytics company focused on improving the future of transportation. It collects and analyzes tons of data, using predictive analytics to build solutions for insurance companies, as well as other companies in the transportation ecosystem, to better price their customers.
“It’s the first time in history that insurance marketers have been able to segment and target people based on the way they drive,” said Jen Gold, director of product marketing. “This is real driving data that we provide. So it’s exciting and very real, and we’re at a point where we need to inform the market about it.”
Built In Chicago sat down with two members of the marketing solutions team, Gold and Fred Dimesa, head of marketing and aggregated data products, to learn more.
I understand that the marketing solutions team is one of Arity’s new segments. How did this team come about and why?
Dimesa: I really helped build this team. In 2016, I worked at Answer Financial, which is also part of The Allstate Corporation. We looked at telematics and how we could use telematics to make better marketing choices for insurance companies. How do we generate more leads? How do we get more quality in the funnel for our partners? We’ve found that the challenge with telematics is that you get these great insights about risk, but you don’t get them until after the person is a customer. Whatever their risk, you’ve already brought them in, and the best you can hope for with telematics is to price them appropriately after a policy cycle.
So we wondered, “What if you had all that information up front, and then made decisions about how much you’d spend getting better customers versus worse customers, and do it in a way that’s essentially fairer to a customer? ?” The data would be based on current behavior, not on what a driver did in the past, but on how he drives his vehicle now and how often. That’s what we were going to do. The challenge here is: how do you get data?
Answer: We started building partnerships with mobile apps where driving was relevant to consumers, where we could educate consumers about how they drive and make offers based on that. To do that, we had to partner with Arity, because Arity owned the Driving Engine Software Development Kit (SDK). In the beginning, we started as separate entities working together. But once we had some success, it became pretty clear that this was really an Arity product line. And so my time with Arity began.
What kind of apps do you partner with to get this data?
Dimesa: Family safety apps like Life360 or weather apps like WeatherBug. Places where we can create experiences around driving with data. The key is transparency for consumers so that they really understand what is being tracked and its benefit, in addition to potential savings on insurance. Savings on insurance won’t be enough from our perspective to let anyone share that much data. You have to give them a little more.
The key is transparency for consumers so they really understand what‘are tracked, and its benefit, in addition to potential savings on insurance”
Gold: By implementing our SDK, mobile apps can become part of our mobile advertising network, the Arity Private Marketplace. It allows them to automatically run ads on their mobile app and start earning money through a revenue sharing agreement.
The SDK also includes a cool Collision Detection feature that alerts users when they’ve been in a collision, and can connect with users’ contacts, who can be alerted in real time along with emergency services. Another feature of the SDK is that it allows an app to understand where its users often travel, what kind of routes and commutes they often take, allowing the app to be predictive of that information.
How have recent consumer data privacy laws changed the way Arity and other similar companies that collect user data operate?
Dimesa: Over time, we have seen a continuous march for privacy and user transparency. It all started with the European General Data Protection Regulation (GDPR) in 2018, which imposed obligations on organizations around the world as long as they target or collect data from people in Europe. That formed the basis for new laws, such as Apple’s recent decision to let users decide whether to opt in or out of tracking in-app ads.
All in all, I think it’s actually been good for the business. Knowing what to meet is a challenge. It’s nice because it’s not the wild west anymore. In the past, many people did things they shouldn’t do with data, and now there are clear rules. Now we actually have a playbook that we can follow, and that’s what we do.
You need to invest in compliance to make sure you do it right. It’s not our job to tell everyone about all your business. We’re here to really grab the insights that are valuable to you as a consumer and use those insights in a way that doesn’t give everyone access to your data. Ultimately, as a company, we were already quite privacy-oriented and we’re happy to see the rest of the world catching up.
Arity constantly receives success stories from their back-end technology, and none are more powerful than the stories where it may have saved someone’s life. Take a recent example from Life360. A teenager was in a serious car accident in Kansas. After waiting for his return home, his mother opened the Life360 app and noticed that her son was not where he needed to be. She was able to use his location to find him and call the authorities. “We hear a lot about these stories. It’s powerful to know that our technology has saved this teen’s life,” said Stacy Silver, communications manager at Arity.
What excites you most about being part of the marketing solutions team?
Gold: We are in the middle of two sectors, advertising technology and insurance. Insurance has been around for a long time and advertising technology has been around for about 25 years. What we’re doing at Arity in the marketing solutions team is quite disruptive; it’s unlike anything that existed before, both on the ad-tech side and the insurance side. We have the ability to understand how people move around the world and reach them at scale in a relevant, contextual way. It’s really cool to be at the forefront of that and find out how you can use a new set of tools to help marketers make better connections with their prospects and their customers.
Dimesa: I think what’s really interesting is the diversity of ideas and the diversity of experiences in this team. We have people who have been working for over 30 years; people just out of school; people who are data scientists and engineers and marketers and strategists. Being able to have everything in one room is interesting, because you learn a lot from it. It encourages you to learn new skills and embrace new ideas.
What does the future look like in this industry?
Gold: It’s exciting, but it’s challenging because what we’re trying to do is change the way some marketers, who are mainly insurance marketers, think about what success looks like.
We are at a turning point in adtech because of all the new regulations we talked about. Privacy has increased and consumer control over their data has increased and things like third-party cookies are disappearing. But new things are also coming. At Arity, we’re trying to teach insurance marketers how to look at the results of their campaigns in a different way, as well as to plan their campaigns around the way people actually drive. It’s the first time in history that insurance marketers have been able to target people based on the way they actually drive, not just making assumptions like in the past.
It’s somewhere between working in a startup and working in a large enterprise, in the sense that we have real resources and not short, VC-esque timelines.”
Dimesa: It is a dynamic space to work in. You have to be comfortable with change and be creative. We’re trying to change a 100-year-old industry and make insurance marketers think differently about what their KPIs should be. We’re trying to change the industry and focus less on acquisition costs and more on what good drivers mean to their business. The challenge here is that we are changing a slow-moving industry. It’s a conservative industry, and for good reason. But it wants to change, and the bigger companies are just as likely to change the industry as these new startups. We’re here to work with them all, so that’s what makes Arity a fascinating place to be.
It’s somewhere between working within a startup and working within a large enterprise, in that we have real resources and not short, VC-esque timelines. We know this is a big challenge. We know it will take time and resources. We’re not just trying to make a quarterly figure here.