The National Highways Authority of India (NHAI) is planning to modernize toll collection by switching to a satellite-based system. This new system will eliminate physical toll booths, reduce road congestion, and create a profitable opportunity for insurance companies. The new system, leveraging real-time location data, allows insurers to customise motor vehicle insurance, enhancing precision in risk assessment and pricing.
On Tuesday, NHAI held a workshop on the Global Navigation Satellite System (GNSS), following the tender announcements made earlier this month. Preliminary discussions highlighted the authority’s intention to amend central motor vehicle rules to mandate the installation of on-board units (OBUs) in vehicles, enabling seamless satellite-based toll transactions. Industry experts believe that the integration of GNSS data with insurance platforms will lead to more tailored and dynamic insurance products. Real-time data from OBUs can provide detailed insights into driving patterns, locations, and vehicle usage, allowing insurers to develop policies that reflect actual driving behaviour and risk, potentially leading to lower premiums for safe drivers and better risk management for insurers. The NHAI’s initiative is poised to significantly impact the insurance sector, opening new avenues for innovation and customer-centric offerings. This move underscores the growing synergy between advanced technology and traditional industries, promising a future where infrastructure improvements drive financial sector growth.
