With six American patents in place, the insurer has now announced the rules for the use of its intellectual property.
Progressive has just announced the terms of a new licensing program that it has developed for the use of its usage based insurance programs and the various proprietary elements that are related to them.
The insurer has been carefully developing and protecting the various parts of these programs over the years.
This licensing option has been long awaited by the industry, as the insurer has been indicating that it would make it available at some point, when the terms could be defined. According to a press release from the company, “We have been developing and refining our industry-leading UBI program for more than 15 years and have been awarded six patents for good reason.” This statement was made by Glenn Renwick, the CEO of Progressive Insurance.
This company is currently the leader in the usage based insurance auto coverage sector.
It has six patents in the United States for various parts of its usage based insurance program. The application of the accounts in that category currently brings in over $1 billion in premiums. This type of policy is currently being offered by the company in 43 states, in addition to the District of Columbia.
Now, Progressive has stated that it will be licensing out its usage based insurance intellectual property to other companies that are interested in putting similar programs into place. They have released the following terms for use:
• The licenses will continue from the starting date through until April 2022.
• Those licensing the usage based insurance program elements are not permitted to begin basing their premiums on the driving habits of their customers ahead of April 1, 2015.
• Progressive will be paid an annual royalty payment that is the same as the Private Passenger Auto coverage direct written premiums for the most recently reported year, multiplied by 0.02 percent (2 basis points).
The insurer has reserved the right to licensor recognition. It is opening up the application to license the usage based insurance program under these terms from now until June 2013, with payments starting on or following April 2015.