A Ford assuring Farm yearlong study of advanced driver assistance system build data seems to provide further confirmation that such technology can lower the danger for insurers — and then the business coming to body shops.
Drilling down to build data revealed that some Ford, Lincoln and Mercury vehicles dating back 2010 had good enough technology their owners deserved a price reduction, based upon a Ford news release and a similar one from State Farm. Ford said State Farm had reciprocated for the build data by sharing claims data related to vehicle features.
“We're finding solutions for future years by grounding all things in data, research and insights,” State Farm operations Vice President Craig Isaacs said in a statement. “What’s unique relating to this project is we’re not just looking at the make and model of a vehicle, but ultimately towards the individual safety features on each vehicle.”
Ford said the research results “lowered the total cost of car ownership for many of the companies' shared customers.” It said State Farm adjusted premiums accordingly in the first 1 / 2 of the entire year, “with savings of up to 20%.”
“Our new build data API piloted with State Farm is another way we're using data to help our customers make the most out of their Ford, in a lower total price of ownership,” Ford digital insurance manager Tim Meek said in a statement. “What's more, State Farm can access build data to 2010, which means second and third owners also benefit.”
Ford’s news release said State Farm could use build data to study links to frequency and severity. The severity real question is particularly interesting for the reason that conventional wisdom holds that ADAS lowers frequency raises severity by adding more parts to purchase and new operations to revive the tech. But research from CCC and Honda also offers found the opportunity of ADAS to lower severity by mitigating the crashes that happen.
Ford didn’t respond to an inquiry seeking additional information concerning the correlation between build data and risk reduction and what the study showed regarding severity specifically.
Reached concentrating on the same questions, State Farm said it had nothing more to talk about — “it’s all within the press release,” a spokeswoman wrote.
There’s a couple of lessons for body shops.
First, it’s not just new vehicles that have ADAS — Ford models dating back to 2010 might also have carried it, in line with the news release.
Second, we've got the technology is capable of reducing frequency and/or severity to some degree that State Farm’s actuaries are comfy betting on it. This is potentially bad news when it comes to shops’ future Ford-related collision revenue.
There is one silver lining here: Shops and the nation’s No. 1 insurer should experience less friction concerning the repair bills that arise with Ford vehicles. State Farm adjusters certainly needs to be receptive to OEM procedures essential for restoring tech now officially factored to their employer’s risk.
