Please can you give me an overview of LexisNexis Risk Solutions and how the business was founded?
Ballard... LexisNexis Risk Solutions is a data, analytics and technology provider to the insurance and car manufacturing markets in Europe. We are part of a global business that has 40 years’ experience providing innovative solutions to risk data analytics challenges. We use data, advanced analytics, and innovative technologies to create insights for insurers and car manufacturers to help them solve problems, make better decisions, and improve their operations.
LexisNexis Risk Solutions is part of the Risk & Business Analytics market segment at RELX, a global provider of information and analytics and one of the 100 biggest London-listed companies by market capitalisation.
What are LexisNexis Risk Solutions main products and services?
Ballard... We provide a wide range of data solutions to the insurance market to help inform each stage of the customer journey – from quote to claim across motor, home and commercial property insurance. Our core proprietary products in the UK are based on market-wide policy history, claim and quotation data.
Recognising the connected car trajectory and the continuing advances in Advanced Driver Assist Systems (ADAS), we are now connecting insurance providers to European car manufacturers to maximise the value of vehicle-centric data.
Our vehicle data solutions take two forms. The first is static data on the presence of ADAS. The second is dynamic data on the vehicle’s mileage and driving behaviour. In essence, we provide this data to the insurance market, with the customer’s consent, for use in insurance pricing and claims. In this way, consumers can access more accurate and personalised insurance cover based on the precise features and options fitted into their vehicle, as well as their individual driving behaviour.
What is the main innovation you bring to the market?
Ballard... LexisNexis® Vehicle Build is a new solution to better evaluate specific Advanced Driver Assistance Systems (ADAS) and support insurance pricing and underwriting. Our data scientists have developed an ADAS classification system which focuses on the needs of insurers. We defined many ADAS features and challenged ourselves to reduce claims frequency rather than simply improve drivers’ comfort and convenience.
For car manufacturers, understanding the link between in-car safety features and insurance claims could offer deeper insight for vehicle-level benchmarking and to understand ADAS system efficacy. This approach also gives car-makers the ability to showcase the benefits of purchasing vehicles equipped with safety features, supporting the sector’s zero fatality strategic objective.
What is the greatest challenge that the company overcame?
Ballard... Deciphering the specifications of a new vehicle is very complex. Also, ADAS features tend to be described very differently from manufacturer to manufacturer to create market differentiation. An added complication is the availability of packs, where the original equipment manufacturer (OEM) will group together a number of features and offer these as an equipment pack. These too will have a name and the content of the pack can differ over time based on consumer demand and competitor benchmarking.
To address this problem, an ADAS classification system has been created to classify vehicle safety features and the component’s intended purpose. European motor manufacturers are now starting to share ADAS data, and testing is well underway to understand how ADAS fitments relate to claims with motor insurance providers in the UK and Europe. Over 2.5 million vehicles have been assessed across four European countries, so information on the safety features of a car, as well as how well they perform, will be accessible to insurance providers through the Vehicle Identification Number, facilitating insurance quotes.
How do your products and services tie into the growing use of automation in manufacturing?
Ballard... Our solutions deliver more insight to car manufacturers on the efficacy of ADAS, thus supporting car design. We also help solve the so-called many to many problem, where you need to connect many car makers to many insurance providers for many vehicles and drivers. First of all, data flowing from millions of vehicles will need consumer permissions to be shared with the insurance market. The data will also need to be standardised so that consumers are priced for insurance consistently regardless of their vehicle make or model. Naturally, this all needs to be managed and controlled within the GDPR principles, a key concern in our sector.
Connected car data exchange is at the heart of our solutions. We bring driving data from motor manufacturers to insurance providers in a fully compliant, normalised, contextualised and standardised manner. This approach removes much of the complexity, cost and compliance issues car manufacturers could otherwise face, delivering insurance benefits from the connected car. It also helps pave the way for subscription, pay per use, pay per mile and other mobility models of the future.
We estimate that without a data exchange, building connections with the insurance market could cost car manufacturers $4bn.