PayGO System

Pay As You Go vehicle insurance

The Business Opportunity — Use-Dependent Automobile Insurance

PayGO system will enable the insurance company to offer a “Pay as You Go” automobile insurance policy. Implementing PayGO will help the company attract “good drivers” and improve the quality of its insurance portfolio by reducing the average risk of accidents.

Thirty percent of all cars are driven only sparingly. The drivers of these cars are the insurance company’s main pool of “good drivers”, with the lowest probability of being involved in an accident. “Good drivers” feel “deprived” by standard automobile insurance policies, because they pay the same premium paid by heavy users although they represent a lower risk. A flexible “pay as you go” vehicle policy with a significant usage-based premium element offers a win-win solution to this problem, with sizable benefits to all involved.

For the insurance company, offering a “pay as you go” policy can serve as a first rate competitive marketing tool.

A “pay as you go” policy will attract and retain “good drivers”, the insurance company’s preferred customers.
A larger proportion of “good drivers” will reduce the average risk of accidents, improving the quality of the company’s insurance portfolio.
The “pay as you go” policy may induce other drivers to change their driving habits in order to enjoy the benefits offered to “good drivers”. Initial research suggests that pricing insurance by usage could cut total driving by 5 to 15%. A 10% reduction in driving is estimated to result in a 17% reduction in crashes.
By creating a vehicle usage database and studying its correlation with accidents, the insurance company can further optimize the terms of the “pay as you go” policy.

For the “good driver”, “pay as you go” is a significant and well-deserved benefit.

“Pay-as-you-go” can save “good drivers” hundreds of dollars in premium costs.

PayGO — Effective but Simple

PayGO is a proprietary method for “Pay-As-You-Go” implementation, which is both effective and simple. Rather than attempting to monitor all car usage parameters, PayGO is focused on monitoring the two central parameters that are most relevant to risk assessment: duration of travel and time of travel.

PayGO offers insurance companies and “good drivers” all the advantages of a “pay-as-you-go” system, at a low cost and with minimal logistics.

PayGO does not compromise the customer’s privacy—it is not a tracking system and does not collect sensitive data (e.g. vehicle location and speed of travel).
Installation is simple and easy, with no skill required.
There is no risk of damaging the vehicle, hence driver opposition is less.
The module is independent, does not connect to car systems and requires no maintenance.
There is no infringement of the auto manufacturers’ warrantee conditions.
The module is inexpensive and system operation cost is low because of its simplicity.
All the data are collected independently without the driver’s intervention.

PayGO offers an outstanding opportunity for the insurance company to improve the size and quality of its portfolio while boosting its image as a leader of a pro-consumer revolution in the insurance market.