Expanding car access with automated auto insurance verification: A look at car subscriptions, rentals, and more

Car ownership and access has been evolving rapidly in recent years, driven by advancements in technology and changing consumer preferences. The traditional model of owning a car outright is no longer the only option available. Car subscriptions, rentals, and leases have gained popularity, providing consumers with flexibility, convenience, and lower costs up front. Amidst this changing landscape, one crucial aspect remains constant: the need for auto insurance. In fact, with increased consumer access to cars through these various models, automotive companies that provide subscription, rental, or leasing services will need the ability to continuously verify and re-verify auto insurance to ensure compliance and mitigate risks.

 

The rise of car subscription services

Car subscriptions have emerged as a flexible and hassle-free alternative to car ownership. With a subscription, individuals can access a variety of vehicles for a fixed monthly fee, often inclusive of insurance, maintenance, and other services. This model appeals to those who prefer flexibility and want to avoid long-term commitments.

Car subscriptions are a catalyst for the growth of e-commerce in the automotive industry. As a digitally sold product, subscriptions serve as a crucial gateway to e-commerce for retailers in the auto sector because they offer a convenient, low-risk alternative to traditional leasing and ownership methods. These subscription services, like Finn and Kyte, pave the way for an expanded online sales market, which has been slow to develop for new car sales in Europe and the US. 50% of consumers surveyed listed value of cost for car services over everything else citing the convenience of an all-inclusive price-point, covering insurance, taxes, licensing, and maintenance

E-commerce via car subscriptions presents game-changing advantages for the automotive industry, which is burdened with high customer acquisition costs. By reducing sales expenses and enabling scalable growth, it offers significant benefits. Reluctant buyers now have the option to sign up for a subscription, allowing the seller to acquire a customer. Even if the buyer doesn't commit to a purchase immediately, subscriptions can help foster customer loyalty and brand affinity.

 

Trends for car rentals, leases, and ownership 

Despite the growth of car subscription services, rentals, leases, and ownership remain relevant. Car rentals have long been a popular option, especially for short-term needs or when traveling. Services like ride-sharing platforms have further fueled the demand for rentals, making it convenient and cost-effective for individuals to access vehicles on-demand. In fact, global car rental market growth has remained steady and is expected to reach a value of $95.7 billion by 2028.

In the traditional car purchase and leasing space, dealerships are using a combination of digital and in-person selling tactics to stay competitive, and, due to overproduction and falling car prices, car purchases are finally set to increase after years of unstable market conditions.

 

Why all types of automotive dealers should embrace automated auto insurance verification 

Regardless of how consumers drive a car, valid auto insurance is a legal and financial necessity. Insurance provides protection for both the driver and other parties involved including the car rental or subscription service, which covers medical expenses, property damage, and legal fees. Insurance verification is the critical, yet often tedious, process that these automotive companies must undertake to ensure compliance and protect their assets. However, the process can be challenging, particularly when dealing with different ownership models and antiquated processes. Dealerships, car rental companies, and car subscription services use and validate auto insurance in different ways, but all will need to maximize their efficiency and mitigate risk by ensuring their vehicles have sufficient insurance coverage:

  • Car subscription services provide insurance for their own vehicles, but they need to be able to verify their vehicles have current, up-to-date policies on a regular basis.
  • Rental car companies rely on the consumer to provide insurance via purchasing of the company’s insurance policy or by providing their own via their credit card or personal auto insurance policy
  • Dealerships and other auto financers require a full coverage auto insurance policy prior to a consumer buying a car

 

Automating auto insurance verification to improve efficiencies

Whether dealing internally or with the consumer directly, automotive companies and dealers should embrace automated auto insurance verification to complete the verification process instantly to improve efficiencies and remain competitive and compliant. Automated auto insurance verification involves using APIs to connect the business to a web server (i.e. an insurance portal or account) and enables: 

  • Instant accurate, up-to-date consumer insurance data: Car dealers, financers, and rental companies, will be able to gather consumer insurance data directly from a consumer’s online insurance account using consumer-permissioned data
  • Easy, automated insurance re-verification: Car subscription services will be able to automate the re-verification of the insurance on their fleet of vehicles. This new method of verifying auto insurance is a faster and easier way to stay on top of necessary insurance coverage. 

Attracting customers through insurance discounts

Dealerships, auto financers, and rental car companies should strive to stay competitive and remaining compliant by offering discounted insurance as a value-added service, or embedded product. By partnering with insurance providers and negotiating favorable rates, automotive companies, including dealerships, lenders, and rental car companies, can offer customers the convenience of obtaining insurance coverage directly during the car selection process. This not only simplifies the insurance acquisition process for customers but also strengthens the overall value proposition of the company's offerings and ensures that the car will have sufficient coverage.

 

MeasureOne's top auto insurance verification and re-verification solution

While the world of car dealers and usage is evolving, auto insurance will continue to be a necessity—why not automate it?

With MeasureOne, your business can verify auto insurance policies instantly and gain instant access to a consumer's insurance policy or re-verify your fleet’s insurance policies to ensure coverage is sufficient. Using consumer-permissioned data, MeasureOne provides automated access to insurance data directly from primary sources, ensuring the most up-to-date auto insurance information.

MeasureOne offers a variety of integration options:

  • Hosted portal: With no development involved, MeasureOne provides hosted web experiences to access and share auto insurance data and verify auto insurance.
  • API: Integrate the consumer experience natively into your application. Results will automatically populate your platform
  • Third-party platform: MeasureOne integrates with third party platforms allowing for easier integration and deployment using your existing operational workflow

Interested in more? Try MeasureOne’s platform risk-free for 30 days to see how the platform can drive automated insurance verification.