telematics- enabled auto insurance is a form of policy in which insurance companies rely on in-vehicle tracking devices to monitor your driving habits and trends. These devices track your vehicle’s speed, mileage, total driving time, and other factors to help determine policyholder insurance premiums.
Telematics can provide real-time data that measures driver behavior and helps insurance companies better understand your level of risk.
Car insurance providers use a wide variety of factors to determine your insurance rates. These factors will help them determine how likely you are to file a claim or cause an accident in which someone else files a claim.
Every insurance company seeks to ensure that the price (your premium) is proportional to the risk.
What if your insurance premium is personalized based on your driving style?
You can save a lot on premiums if you drive safely. Your auto insurance provider can accurately quote your premium based on driving behavior and can quote a competitive rate, while at the same time properly managing your risk. They typically track how you drive over 90 days to get a sense of your driving habits.
How do insurance companies collect driving data?
Different apps require different types of devices or methods to record your data.
Some insurance companies may use your mobile phone to record and report driving performance through an app. However, some systems may require you to install a device in your Salvage title car that will record and transmit driving events.
The various types of devices used in telematics systems include:
- Mobile App: The mobile app provided by the insurance provider uses smartphone sensors to track driver behavior data. The smartphone app transmits data from your phone to the insurance company’s central server. Mobile apps can monitor braking, speed, acceleration, and cornering.
- Bluetooth Assisted Devices: These are fixed self-powered devices for vehicles that use your smartphone’s network to transmit driving data to the insurance provider. These fixed devices allow the direct association of trip data with the insured vehicle.
- OBD II Port: This is an on-board computer that monitors all vehicle data, including driver behavior, vehicle maintenance, emissions, etc. The device plugs into the OBD II port and can transmit data over the cellular network.
- 12V Connector: These are easy to use and do not require a backup battery. The device can transmit driver behavior data to your smartphone via Bluetooth.
- OEM: Automakers can also equip a vehicle with built-in telematics functionality. These are typically stand-alone devices and provide additional functionality for users.
What are the benefits of telematics for motorists?
- Lower premiums: The main benefit is that your premiums will be lower. If you are a good driver, you can benefit from a lower rate that accurately measures your risk factor. Insurance companies will calculate your rates based on driving behavior and location rather than your lifestyle, home address, and credit score
- Driver feedback: You can also receive reports and feedback from the driver based on the data generated by the telematics system. It can help improve handling characteristics and can reduce the chance of an accident.
- Internet-connected cars: If your car has a built-in system, it most likely has access to a connected system that can provide you with value-added services.
- Theft protection: Telematics systems can not only track your stolen vehicle but also prevent it from starting after it has been turned off. A telematics system can also slow down your stolen car in the event of a police chase.
- Transparent claim process: Accident data will help insurers identify who is at fault, making the claim process transparent.
It doesn’t matter if you have a telematics system or not, always remember to drive carefully and obey traffic rules to avoid an accident.
If you have any questions about telematic devices or want to buy coverage for your car at the best price.