1 Efficient Vehicle Assessor™Profitable Insurance Innovation Agents Council for Technology Oct 2, 2015
2 Insurance Agents and the Efficient Vehicle Assessor PilotConnects gas pumps to the Internet of Things to enable transactions for insurance, etc. Creates a new distribution channel for independent agents Can accelerate adoption of UBI without requiring on-board devices Provides group sales opportunity to millions of ETC users Creates platform for product innovation and enhanced customer service Saves drivers hundreds of dollars annually
3 Partner development E-ZPass Group and States InsuranceE-ZPass Group to join pilot, co-market and endorse Verdeva transactions State discussions in MA, NY MD, DE, FL, IL and CA Insurance Carriers (national and regional) Independent agent channels Fuel retailers in MA, NH, NY, PA, MD, FL, GA Retail innovators – offering retail discount and rebate programs Technical partners: Kapsch TrafficCom LogMeIn/Xively Freescale Semiconductor Verifone State Pilot Discussions: Maryland, Delaware, New York, Massachusetts, Connecticut. I- 95 Corridor Coalition. Developing business and technical partners key to Verdeva value chain: LogMeIn/Xively: Industry leading IoT solution provider. E-ZPass/Kapsch Trafficom: ITS company with contract to provide E-Zpass technology (transponders, readers, toll systems, etc.) Fuel Retailers: major brand hyper-station discussions underway. Auto Insurance: national and regional brand insurance and risk data aggregator discussions underway. Payment Innovators: payment processing innovators focused on fuel-retailers and motorists. Wilson Sonsini Goodrich & Rosati: Premier legal advisor to technology and growth enterprises.
4 About EVA
5 Verdeva’s “Efficient Vehicle Assessor”EVA connects the gas pump to the Internet of Things to offer simple and secure personalized transactions (2) Card swipe enables EVA‘s apps at the pump and on the smartphone (1) Vehicles identified by toll transponder ID, EVA retrieves vehicle information
6 EVA Field Components
7 EVA Platform Overview Retail Insurance POS / IoT gateway State & LocalXively Management Studio MESSAGING Real-time, carrier grade messaging & routing XIVELY API Rest, Sockets, MQTT Rescue Bold Chat Join.me Cubby TRUST ENGINE Secure permissioning from messaging to infrastructure DATA SERVICES Storage and retrieval for time series data and files DIRECTORY SERVICES Searchable directory of objects and permissions POS / IoT gateway State & Local
8 The Pump and the Pass The Pump The Pass (E-ZPass™)150,000 fuel retailers with 1 million dispensers Total visits per day (U.S.): 40 million Time of average visit: 4 minutes Secure payment preauthorized Retailers need new revenue streams The Pass (E-ZPass™) 16 million E-ZPass accounts/27 million vehicles Vehicle identification already on board E-ZPass Group seeks new consumer apps, will promote EVA to its customer base EVA will support SunPass, federal requirements for ETC interoperability by October 2016 The gas pump and E-Zpass (and eventually other toll transponders) Average motorist refuels nearly 60 times per year. Most of the visit is idle time staring at the pump. When the motorist swipes their card to start transaction, they preauthorize secure payment. E-Zpass is in use throughout the Eastern seaboard plus Ohio and Indiana. Brand managed by interstate quasi-government organization, E-Zpass Group (part of the I-95 Corridor Coalition, which consists of the tolling authorities in states along Interstate 95). E-Zpass Group interested in retailer partnerships. (See C-store account sales, use of E-Zpass for parking lot payments, even fast-food drive-through payment experiment) All electronic toll collection (ETC): national priority. Reader technology now open source.
9 Verdeva connects fuel retailers to the digital economyInsurance DMV Payments Retail Options Fines & Fees Payments EVA provides new revenue channels, customer incentives; enhances retail experience with time- and cost-saving options; delivers generous revenue share to retailers Group sales to 10’s of millions of ETC users UBI and other product innovation, a $20-50B market in 5 years Simple DMV transactions $2-3 billion market in registration renewals alone Essentially, what we do is bring the gas station’s storefront into the digital economy. You can see the muscle we add to the pumps: PAYDAYS insurance products, a $34 billion market in 5 years, saving consumers $100 to $400 per year compared to conventional insurance premiums Simple DMV transactions, a $2.5 billion market in just registration renewals. DMV reminders (for example, inspection due) Quick DMV transactions like registration renewals). (Only registration renewal fees are in the business model, although other simple transactions are possible). Easy, convenient interface for payment of fines, fees and tolls – an $8 billion market. Consumers can pay installments, something not possible now. A number of retail options that include Support for the sale of alternative fuels, especially avoiding E15 misfueling, Adding a lot of power to their retail loyalty programs, etc. For example, instead of a loyalty card earning you points toward a Slurpy, we could add serious benefits into the mix. Essentially a free stolen-vehicle locator at every gas pump Pumps tied into AMBER Alert systems And here’s the result of improving their customer’s experience: We pay a generous share of fees to the station. And all of this without charging for setup or maintenance! Convenient payment of fines and fees $7 billion market Product sales at the pump Retail innovation Personalized reminders
10 First Stage: Consumer Apps Second Stage: EVA Policy Apps
11 First Stage: Consumer AppsEVA Group & Pay-As-You-Drive-And-You-Save™ Insurance EVA E-ZPay™ – Convenient vehicle-centric transactions EVA Affinity™ – Customized reminders, retail offers Because we know the exact vehicle at the pump, AND the consumer, we can complete additional secure transactions with extremely simple Yes/No questions.
12 EVA Group and PAYDAYS InsuranceEVA Group provides personalized marketing at the pump or by text E-ZPass membership presents a large group opportunity to insurance partners Option to discount based on known demographics EVA PAYDAYS – usage-based insurance (UBI) 90% of consumers interested in UBI to save $100s annually Nearly 50% have privacy concerns EVA PAYDAYS delivers a “UBI-lite” that overcomes privacy, technical and cost hurdles while capturing the major actuarial data needed for usage pricing (mileage) Verdeva will establish agency relationships in each state that we operate, and will ask for a fraction of the commission than is standard for the industry, to produce and support EVA PAYDAYS policies. Insurer profitability is enhanced while the consumer saves money. Although we charge much less, our IoT-based connection to the customer and vehicle puts us in position to deliver extremely personalized and high-touch services, delivering very high consumer satisfaction, as well as unique features and services, including: Convenience reminders and messages related to premium payments, renewals, claims and account services Innovative premium payment options; e.g., pay-as-you-go Extremely responsive and informed customer service. We will have the full person, vehicle, and member profile including EVA transaction history in front of our call center representative instantly. We will leverage our IoT-connected CRM backend software, making contact with our call centers quick, informed, and multi-channel. Down the road: Integrated and on-demand proof-of-coverage service On-demand and variable coverage options
13 PAYDAYS allows UBI market to fulfill its potentialOn-board device (OBD) hinders UBI adoption EVA overcomes cost, technical and privacy hurdles Cost On-board telematics are costly hurdle for insurers Wireless data plans expensive Cost is 40x-60x more than EVA Telematics at the pump, not car No capital investment by insurer Cuts cost by 40x-60x versus OBD Technical Devices/vehicles are not standardized Cell phones not always present Battery drainage EVA identifies any vehicle by RFID at the pump OBD access not needed Wireless data transfer not needed Despite the promised growth and the readiness of the market (over 40% of insurers, and all major brands, already have UBI offerings), adoption is slow, and is currently only 1-to-2% of the market. This is EVA’s central value proposition for the insurance market: we remove obstacles, allowing the UBI market to fulfill its potential. We very directly overcome privacy, cost, and technical hurdles. Cost: EVA does not require on-board devices, instead, telematics are at the pump, and mileage is verified based on refueling, online data and consumer interaction. Verdeva delivers EVA PAYDAYS with no field capital investment required by the insurer. Technical: EVA identifies any vehicle by RFID at the pump; enables frictionless enrollment; does not require access to on-board diagnostics or wireless usage data transmission (which can cost as much as $5 per month) Privacy: EVA PAYDAYS does not require driver behavior tracking. Apps are opt-in, eliminating privacy concern And in the future, as OBD and NFC access gain market share Verdeva will integrate with it as well to enrich the vehicle/driver data profile and add program options for EVA membership. Data capture at the pump or refueling station will continue to offer feature and cost benefits vs. wireless. Privacy Tracking driver behavior raises concerns Some states only allow mileage-based usage to be considered Does not require driver-behavior tracking Apps are opt-in No perceived “snooping”
14 PAYDAYS – occasional mileage verificationFinish Thank you – Print Receipt? Yes No Receipts will include EVA transactions On the phone: Welcome Pay Inside Pay Credit Here Pay Debit Here Start During refueling, at the pump or on the phone… At the pump: EVA PAYDAYS update request: Please enter your 2013 Ford Mustang current odometer reading: [ _ _ _ _ _ _ ] OK Not now Verdeva will establish agency relationships in each state that we operate, to produce and support EVA PAYDAYS policies. Insurer profitability is enhanced while the consumer saves money. Our IoT-based connection to the customer and vehicle puts us in position to deliver extremely personalized and high-touch services, delivering very high consumer satisfaction, as well as unique features and services, including: Convenience reminders and messages related to premium payments, renewals, claims and account services Innovative premium payment options; e.g., pay as you go. Future options On-demand proof-of-coverage service On-demand and variable coverage options Extremely responsive and informed customer service. We will have the full person, vehicle, and member profile including EVA transaction history in front of our call center representative instantly. We will leverage our IoT-connected CRM backend software, making contact with our call centers quick, informed, and multi-channel.
15 EVA’s insurance offerings – other innovative featuresConvenient and captive consumer interaction at the pump or on the phone Payment reminders Innovative payment plans Temporary product options On-demand proof-of-coverage No-charge mileage verification and usage data
16 EVA E-ZPay – one-touch convenience payment optionsOn the phone: EVA: Your 2013 Ford Mustang insurance payment is due. Pay $70 premium payment now? (Receipt will be ed.) Your message was processed successfully Welcome Pay Inside Pay Credit Here Pay Debit Here Start During refueling, at the pump or on the phone… At the pump: EVA update: Your 2013 Ford Mustang insurance payment is due. Pay $70 premium payment now? (Receipt will print.) Ok Not now Finish Thank you – Print Receipt? Yes No Receipts will include EVA transactions
17 EVA E-ZPay – one-touch convenience payment optionsAt the pump: EVA update: Your 2013 Ford Mustang registration renewal is due. Pay the $45 DMV fee now? (Receipt will print. Documents will be mailed.) Ok Not now During refueling, at the pump or on the phone… On the phone: EVA: Your 2013 Ford Mustang registration renewal is due. Pay $45 DMV fee now? (Receipt will be ed. Documents will be mailed.) Your message was processed successfully Welcome Pay Inside Pay Credit Here Pay Debit Here Start Finish Thank you – Print Receipt? Yes No Receipts will include EVA transactions
18 Second Stage: EVA Policy AppsEVA Estimated Miles Driven and Compliance applications
19 EVA seen as a policy game-changer by very senior officialsPolicy Challenge Verdeva Solution Sustainable transportation funding (failed gas tax) Politically viable alternative to gas tax Non-tax revenues needed to balance budget. Non-tax revenues captured at the pump Non-compliant vehicles cost billions of dollars Identification at-the-pump enables compliance opportunity Sustainable Transportation Funding: The gas tax is failing badly due to increasing fuel efficiency. We enable a politically viable alternative to gas tax. Environment: There’s an urgent need for more effective market-based incentives to reduce carbon emissions. Fiscal health: There is a desperate need to find non-tax revenues to balance budgets. Law enforcement: Non-compliant vehicles cost legitimate drivers and governments billions of dollars. Insurance: One in six drivers are uninsured, costing insured drivers nearly $12 billion yearly. Registration: Unregistered vehicles in states cost taxpayers $150 million or more in lost fees. (At least 3%, probably much more, are unregistered.) Toll Evaders: As toll gates come down, toll evasion is going up, costing millions of dollars which are expensive to collect. EVA can require payment at the pump. Parking Scofflaws: Over $4B owed nationally to cash-strapped localities. Thefts and Amber Alerts: EVA can quietly notify police departments of stolen vehicles at the pump No cost to government to install or maintain system. Environment Market-based incentives to reduce carbon emissions Solutions are expensive No cost to government to install or maintain system
20 EVA Estimated Miles Driven (EMD) apps for sustainable transportation fundingFeature Gas Tax VMT (public perception) EVA EMD EVA Advantage Invasion of Privacy? No Yes EVA does not track vehicles. GPS-based VMT does. Self-funded installation? N/A No Yes A public-private venture, EVA’s installation/operation is self-funding. Different rate for rural drivers? No Yes This will be viewed very favorably by rural drivers. Tiered, segmented rates? No Yes EVA enables a progressive pricing structure based on type of user and usage (e.g., occupational). User Fee? Yes EVA and gas tax are consumption-based user fees. VMT is actual mileage. Incentivize efficient vehicles? Yes No EVA is a truly transformative tool in effort to reduce carbon emissions.
21 EVA policy apps support inevitable transportation policy reformStates mandate a solution for transportation funding and other transportation policies Electronic vehicle identification key to solution EVA will be positioned as solution of choice Stage 1 consumer apps in place Same vehicle ID model as electronic tolling systems Pump rather than vehicle-based telematics No-cost business model The prospect: EVA adopted at 100% of stations State mandate can be just to put RFID at the pump (versus mandating that every car get an OBD)
22 For additional information:Thank You For additional information: John Condon Research Director