Can insurance companies make roads safer?

When Aegon’s startup Kroodle set out to provide lower car insurance premiums based on real driver data, their out-of-the-box thinking helped them become THE leader in data-driven insurance.

Using Kroodle in a stationary car

Kroodle insurance in the Netherlands was already market-leading in terms of service: cancel any time, instant online coverage, and no initial set-up costs. With their newest product, CarKroodle, they're raising the ante by rewarding customers with a discount of up to 20% for safer driving – tracked via GPS.

Customers receive a 'KroodleStick', which plugs into the cars' onboard diagnostic socket – available on all but the very oldest of models. The stick relays information to an app on your phone and records things like how often you drive and how hard you accelerate or brake, based on the assumption that severe braking normally occurs if you're too close to the car in front. The KroodleStick also monitors if you exceed the maximum permitted speed, and by how much.


Information is translated into a monthly KroodleScore, that determines how safe a driver you are, and therefore how much discount you'll receive on your insurance premium the following month. The basic premium can't increase, it can only get lower.

Dennis Westerhuis, CEO of Kroodle knew he was on to a good thing early on with CarKroodle. Italian telematics expert, Matteo Carbone's research showed that by simply putting the telematics stick into the car led to a 17% decrease in claims. And that was without any additional reward motivation.

Agile development

As a small startup with Aegon backing Kroodle has been able to speed up the development process. "We're able to use the insights gained to improve existing products and develop new approaches to insurance. At each stage of development, we've tested the product with customers and quickly resolved issues as well as adding new functionality, such as gamification and an ecosystem of relevant car services, wrapped up in an engaging mobile/app experience," says Dennis.

"For example, initially one of the criteria used to determine a customer's KroodleScore was the time of day they were driving. Our data showed that people are more likely to have accidents at certain times of the day. However, as customers can't really influence when they need to use their cars, we've reduced the importance of this factor in the algorithm."

Related benefits

According to Dennis, the app has had a number of unexpected benefits for both the driver and Kroodle. "Through the app, people can see how much they're saving on their insurance premium. We also send them messages about their highest ever scores, comparisons with other drivers, changes over time, and more.

"These regular contact moments with customers help build a solid relationship, but more importantly customers find this gamification approach extremely motivating. It gives them a strong incentive to improve. We've shown that average KroodleScores increased by almost 50% over the course of a year."

Average KroodleScore development

As a result of accelerating more smoothly, reducing driving speeds, and braking less, customers are also achieving significantly improved fuel economy and extending the time between services on some vehicles. This is not only better for the environment, but also for a customer's wallet.

Reduced claims

CarKroodle uses technology to the customer's advantage by passing on savings from reduced claims to customers with proven lower risk. This means that customers aren't paying for someone else's risky driving. And by stimulating a positive driving style among customers, Kroodle should see a reduction in total claims, and reduce premiums even further.

Dennis is adamant that this is just the start. "The data we gather, for example, could be used to provide customers with an annual summary of their journeys, which is often required for tax purposes if a car is used for business.

"We're also talking to customers to see if they would find it useful to monitor their children's driving style should they borrow their car, or receive reminders about servicing. In addition we could notify customers when the KroodleStick registers an engine fault identified by the engine control unit, and perhaps provide special offers from local car dealers."

Kroodle is currently testing the water with other insurers to see if they would be interested in offering CarKroodle customers a lower premium based on their KroodleScore. "Previously," says Dennis, "the only customer data we had was the claim history and address, but the KroodleScore offers a much more accurate insight."

Next steps

The next step, explains Dennis, is to move from the current 'Kroodle light' version to one which gathers much more detailed information: "We've been working together with a spin-off from Delft University of Technology sensor specialists to combine data from additional sensors such as those which detect when you accidentally leave your lane on the highway.

It's early days, but Kroodle's ability to test, improve and explore new options in a short space of time provides us with a huge competitive advantage. It's something that a large, established insurer would find difficult to achieve."