Most people now understand satellite based GPS technology as we have been using it in vehicle tracking devices for many years. In their most basic form, such devices (trackers) monitor the exact location of a vehicle or assett with extreme accuracy. As a natural technological progression, tracking devices have been adapted to develop Telematics – the remote collection of various data sources including, time and location, speed, direction of travel, braking and cornering forces. Such devices have been used very successfully for several years in the logistics, security and remote workforce management sectors.
Insurers have begun providing motor insurance based on this technology, and although currently telematics Insurance or ‘Usage Based Insurance’ (UBI) remains in the minority (less than 5% of the current motor insurance market), many more are planning to do so. UBI relies on individual driver behaviour rather than general statistics in order to set premiums and the policies allow good, experienced and low mileage drivers to benefit from their patience and restraint on the road and penalise those who present more of a risk.
How it works: Drivers pay a premium comprising a small annual charge, plus an amount relating to their predicted usage according to the miles they travel and the times of day they use the roads. Daily driving during the rush hours is more expensive per mile than at quieter times and mileage is calculated continually with discrepancies either refunded or added during the term or at renewal. Future Insurance business models may include a PAYG model exactly like that of a mobile phone operator where a device is credited with Insurance. These credits are ‘used up’ more quickly when the driver is raising their Risk Profile by either driving erratically or for young drivers – driving late at night.
As an incentive, the device could be automatically credited to reward good driving as well as improvement for individual drivers thus developing customer relationships.
Telematics provides underwriting with a significant uplift in the variety and quantity of risk information to price a motor insurance policy by offering the ability to adjust pool-based pricing to individual pricing per vehicle and per driver. This improved risk scoring offers benefits to insurers in terms of managing underwriting risk, however, there is also a benefit to insurers in managing claims costs. Historically, claim notification has struggled with issues that Telematics can help to resolve such as: early notification of the accident from policyholder, capturing accurate details of the claim incident, securing reliable crash event data including geo-tagged video footage which can drastically reduce claim crash management procedures.
Effective Driver Coaching
SatSafe devices record quality information that makes it easy to understand and act upon is what we at SatSafe are about – “to influence driver behaviour in order to reduce accidents and save lives“. We make it easier for you to manage organisational safe driving policies for example speeding and idling, by playing an audible alert to the driver. This will improve safe driving practices as drivers take corrective actions when needed.
Please contact us to learn more about our work.