Telematics progression has advanced right along with internet technology, and will continue that progression. As the world becomes more connected every day, the uses and benefits of telematics will also increase. In a nutshell, telematics is the merging of many telecommunications to process and use information. This is the broad term that is used in academia, but for the general public it is now commonly applied to car safety systems and referred to as vehicle telematics. It combines car technologies, road transportation, road safety, electrical engineering and computer science in an effort to make driving safer, and cost less. The commercial insurance sector has invested a lot of time, money, and effort into what is now called telematics auto insurance. Insurance companies can create and access the safety records of their drivers, in order to regulate the risks and determine premiums. Telematics auto insurance monitors a drivers behavior, which means good drivers can be rewarded with big savings on their car insurance.
A telematics device is a small palm size device that is plugged into your car’s onboard diagnostic port, which is near the steering column under the dashboard. Even cars that were made as far back as 1990 are able to be fitted with the device. The device records information about your driving habits, like miles driven, speed, how many times you slam on the breaks and even the risks associated with where and when you drive. The device is provided to you and installed by your insurance provider, and all the information goes back to them. It is pretty simple really. A safe driver who drives responsibly and incurs less risk is charged a lower premium than a high risk driver. It saves the consumer money, and the insurance company. Safe driving equals fewer accidents which is a win for everyone. Specific discounts differ with each insurance provider and can save you up to 30 percent on your car insurance.
Telematics devices show proven results. Norwich Union conducted trials with young drivers, 18 to 23 years old and determined that having the device resulted in a 20% lower than average accident rate. Lower accident rates are not the only benefit of the device. By having the device installed on your vehicle many programs allow you to go online and track your own data. This makes you more aware of your driving habits, and what you can do to become a better driver. For instance, if you avoid fast acceleration and hard stops, you can promote better fuel economy in your car. This has the effect of saving you money at the pump, as well as making you safer on the road. Another advantage, if your car is stolen the device is usually hidden well enough that it can’t be easily removed, and therefore acts like a tracker, helping authorities find your car more easily.
In the past, the biggest users of telematics devices were companies with large fleets of vehicles to keep track of. The information provided by the device has helped many companies cut costs on fuel usage, and help them analyze their driver’s productivity. As computer processers have become smaller and more abundant, telematics devices have become more predominant in the everyday life of the consumer. Now, if you are a good, consistently safe driver, you can prove it and reap the benefits in cheaper car insurance. If you have been a high risk driver in the past, agreeing to use the device for a specified time period can help you achieve that good driver discount sooner, rather than later. The best way to get started is to contact your insurance provider and ask if telematics devices are a service they offer. If not, shop around for a car insurance company that does offer the service.
The bottom line is telematics is a great tool for anyone who wants to take control of their insurance costs. If you are an inexperienced driver, a young driver, or someone who drives infrequently, telematics insurance can help you get cheaper car insurance premiums. Even if you are a great driver you can still learn to be better, and save money.