Business insurance

USAA of San Antonio acquires San Francisco P&C insurance technology company

The USAA revealed Thursday that it has agreed to acquire a San Francisco-based property and casualty insurance provider that offers usage-based auto insurance.

The San Antonio insurer expects to complete its acquisition of Noblr Inc. later this year. Terms of the contract are not disclosed.

This will be the first acquisition by the USAA of a property and casualty insurance company in its 99-year history.

Noblr uses “behavior-based pricing” which measures how much and how well customers drive. He said it was the only auto insurance product that “evaluates in real time for the term of the policy”.

Noblr’s app, downloaded to customers’ phones, logs their trips in real time and saves them money if they drive less, don’t aggressively accelerate or brake and abstain to send SMS while driving.

The USAA has said that the usage-based insurance offered by Noblr will be useful for its military service members who are highly mobile and frequently deployed. The USAA has approximately 13 million members, made up of serving military personnel, veterans and their families.

“The acquisition of Noblr Inc. increases our competitiveness in the market and adds the choice of capacity (usage-based insurance) for our members,” said USAA CEO and President Wayne Peacock, in a press release.

“Members will benefit from personalized pricing tailored to their risk and user profile, better cost control of their auto policies and an exceptional end-to-end digital experience,” he added.

USAA plans to roll out usage-based insurance over the next three years, starting in the eight states where Noblr is available.

Noblr entered the Texas auto insurance market in October 2019, the same year the company was launched. The company has a service operation in Austin.

Documents filed with the Securities and Exchange Commission show that Noblr has raised at least $ 36 million through the sale of securities over the past two and a half years.

Noblr is an insurance technology or “insurtech” company. It has 8,400 clients.

“This is a wonderful opportunity for the Noblr team to rapidly and significantly expand the implementation of usage-based telematics to more states and to serve our military families, the members of the USAA.” said Noblr CEO and co-founder Gary Tolman.

Last month, the Consumer Federation of America released a report who concluded that telematics programs could lead to lower costs for safe drivers. He added, however, that insurers must demonstrate that their algorithms are fair while ensuring consumer privacy.

“We need guardrails in place so that telematics is not just a Wild West of data collection, unfair discrimination and unwarranted pricing,” said Doug Heller, an advocate for the CFA.

State insurance departments must establish rules for telematics, price transparency and confidentiality, the group added.

Asked how Noblr clients who have no military ties will be affected by the deal, USAA spokesman Christian Bove said the company will assess eligibility criteria and members would be contacted prior to their policy renewal, if necessary. Noblr’s policies will remain the same for now and immediately after the transaction, he added.

USAA will integrate Noblr’s product line into its own operation, Bove said. The approximately 50 Noblr employees will continue to provide services to its members as the USAA introduces Noblr products to its members.

The Noblr program will operate independently of the USAA’s SafePilot program, which primarily uses behavioral data obtained through an app on members’ phones. The program operates in at least 16 states.

The number of SafePilot registrations increased by 200% last year. Almost half of new policyholders in states where SafePilot is available have opted for the program. Members can enjoy policy discounts of up to 30% for safe driving behaviors, the USAA said.

Both programs will be optional for USAA members, who can maintain their traditional politics, Bove said.

The transaction is subject to regulatory approval.

[email protected]

Leave a Reply

Your email address will not be published.