Telematic For The People

Oct 28th, 2015

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Advances in telematics continue apace
Telematics can be used for a number of applications within the insurance industry, such as vehicle tracking and satellite navigation systems, both of which have been widely used for years. More recently however telematics have been used in the insurance sector to measure and record the way a car is driven. The information recorded can show how careful a driver is, which can be used to affect their insurance premium.


One of our clients that uses telematics is DCL, who have a scheme to install cameras and telematics devices into fleet vehicles. In the event of an incident, the video from the on-board cameras can be sent directly to DCL’s claim department so that they can quickly identify liability. Sensitive accelerometers can identify if an incident has occurred, and drivers also have an option to manually register a collision to ensure that the relevant information is sent.

It is interesting to see what use other insurers make of telematics. A recent article in Insurance Times discusses how Admiral has details of a customer’s driving behaviour transmitted back to them. Within minutes of a collision they will know the customer’s speed, location, direction of impact, as well as any acceleration or braking during the incident. By combining this with Google’s virtual mapping service the accident can be reconstructed by the insurer.

What do consumers want from their telematics policies?
A US consumer study into usage-based motor insurance has revealed how a telematics app for smartphones could change motor insurance and improve road safety. In the UK, usage based insurance (UBI) is uncommon. The study’s key finding could still have implications for the market here. In the study, motorists were given the choice between a UBI policy with a discounted premium or with a ‘safe driving’ scheme that came with a telematics app for their smartphone.


More drivers opted for the phone app, which measured and scored their driving behaviour and provided feedback, enabling them to improve their score. The vast majority of these motorists became deeply invested in the app and in the notion of “beating” their own score – and therefore on continual improvement.

David Lukens, LexisNexis Risk Solutions Telematics Director, said: “Offering a premium discount is becoming less attractive to drivers and less sustainable to insurers. Consumers are looking to measure themselves and connect with others across all aspects of their lives, and driving is proving to be no different. The benefit to society is the idea that we can all improve our driving and be safer on the roadways.”

Most of the study’s subjects (77 per cent) said they would continue to monitor their driving, regardless of how well or badly the app scored them, which suggests that the safe driving concept may have the potential to change driver behaviour.

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