There are some things in life that just go together: Peanut butter and jelly; coffee and cream; Bert and Ernie…the list goes on. And now we have something new to add to the list for you: Telematics and Commercial Auto Insurance. Never heard of telematics? You probably have, you just don’t know it.
Telematics is the integrated use of telecommunication and informatics. That means we implant a device in your vehicle and it communicates with a central processor all sorts of information, like how fast you’ve been driving, the rate at which you accelerate or come to a stop, and how far you drive. Here in the insurance industry, we’ve been using telematics for years. Unlike conventional insurance that relies on years of aggregate historical data to determine auto premiums, Usage Based Insurance (UBI) pulls from your telematics score to determine your rate.
Telematics are especially helpful for those of you in charge of operating your own fleet of vehicles. It paints a pretty clear picture of your employees driving habits, which means you can reward safe drivers and work to correct the behaviors of those who maybe aren’t so safe. Even better? With the right score, using telematics in your fleet vehicles may translate to lower commercial auto premiums.
What else can telematics do for your business? Check out the list:
- Telematics help insurers estimate accident damage and reduce the number of fraudulent claims by analyzing the collected data
- Increases affordability for lower-risk drivers (and businesses)
- Monitors driver safety
- Acts as a GPS unit to monitor your fleet and track down stolen vehicles
- Helps determine the most efficient routes, which saves you money
Of course, telematics aren’t perfect. The technology itself is still young and isn’t always the most accessible, but the potential is there.
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