Crabi, a Mexican insurance startup, intends to shake up the lucrative Mexican auto insurance market using artificial intelligence by predicting driver behavior.
Dubbed an “insurtech startup,” Crabi recently raised $1.3 million in startup money to get their platform off the ground. Led by Redwood Ventures, they aim to become a leader in car insurance in Mexico.
Crabi uses a “Fair Drive” model and personalizes auto insurance plans based on a person’s driving records, so drivers with a safe driving record could pay less than others with a not-so-clean record. The National Commission of Insurance and Finances has authorized Crabi to issue digital policies starting in Q2, 2019.
Crabi’s website has yet to release any information on their products so it’s too soon to tell if their policies will be offered to non-Mexican citizens, but all drivers must have a Mexican auto insurance policy when operating a vehicle in Mexico.
Latin American countries are often behind the times when it comes to new technologies and despite a 37 percent spike in insurance industry startups, Mexico has relied on old school insurance companies to write auto insurance polices.
One immediately apparent issue Crabi may have is the lack of documentation that often gets left out when drivers commit infractions due to the overall lack of accountability in Mexico, so it could be difficult for Crabi to determine exactly who is a safe driver and who is not. Just because someone has not received an infraction does not automatically make them a safe driver.
One thing is for certain is it will force existing insurance companies to step-up their game to compete with these new advanced technology services.