Insurtech firm Zego has acquired telematics app Drivit in a move that will bring real-time driver behaviour data in-house to provide more tailored insurance policies.
Portugal-based Drivit has developed a mobile platform that turns a smartphone into a telematics device that captures driving data, such as GPS and gyroscope and accelerometer data.
UK-based Zego did not disclose the sum it paid for Drivit, but told Verdict it was a combination of cash and equity. The two companies have been long-term partners, with Zego integrating Drivit’s technology into its platform.
Zego says its acquisition of Drivit demonstrates its commitment to a data-driven approach to motor insurance. The deal also takes Drivit’s technology off the market, with Zego telling Verdict that it had “no short term plans to license the tech”.
Traditional insurers tend to price motor policies based on factors such as age and the type of vehicle.
The acquisition paves the way for Zego to base insurance policies on a combination of these traditional factors with driver behaviour and working habits data gathered from integrations with company apps such as Uber.
The deal will see Drivit’s team become fully incorporated into Zego. With Drivit’s technology already embedded into Zego’s recently launched Sense app it is likely to be a straightforward transition.
“At Zego, we want to revolutionise the way that commercial motor insurance is priced, and I believe that this acquisition is an important step towards achieving this goal,” said Sten Saar, CEO and co-founder of Zego.
“Owning a market-leading telematics solution gives us the ability to not only collect real-time behavioural data, but also crucially to layer this information on top of our other existing data sources.”
Prior to the acquisition, Zego carried out market research to test the appeal of telematics-based motor insurance policies.
Since it launched in 2016, more than 200,000 vehicles have used Zego for motor insurance. It has raised $65m in funding from private equity.
It provides work insurance for those working in the UK’s delivery industry, partnering with companies such as Uber Eats and Deliveroo.
Gonçalo Farinha, co-founder of Drivit, said: “Drivit was created to untangle the constraints of existing telematics technologies, helping car insurers to develop a new breadth of products and services that use driving behaviour and contextual data to cater to the specific needs of each driver.
“We are embarking on this journey with Zego not only because its mission perfectly aligns with the role we envisioned for Drivit in the world, but also because it is uniquely positioned to dramatically accelerate this shared vision into becoming a reality.”