Technology helps identify, reward safe drivers

Telematics may give parents a tool to help young drivers learn safe habits.

You’re a safe driver: You follow all traffic laws, don’t speed and never allow yourself to be distracted by your phone while driving. Suppose you could take credit for your efforts and earn a discount on your car insurance? With growing adoption of telematics by insurance companies, you can.

WHAT IS TELEMATICS?

Telematics technology is a way for insurers to collect driving habit data to better assess their risk, based on individual drivers. As drivers opt in to providing data, the insurer can tailor pricing to driving behavior, rewarding drivers with good habits.

HOW DOES THE TECHNOLOGY WORK?

The approach varies by company but could involve a plug-in device installed in the car or an app downloaded to the driver’s smartphone. Telematics apps vary by company. They can be part of an insurance company’s own app or downloaded separately to be paired with the company app. When a policyholder drives, the app collects information from each trip and calculates a score based on driving characteristics such as:

·         speeding

·         harsh braking

·         acceleration

·         cornering

·         phone distraction

The app accumulates information over time and produces a driving score.

WHAT DOES YOUR DRIVING SCORE MEAN?

The driving score helps insurance companies determine which drivers are less likely to be involved in accidents and rewards them for their good habits by offering a discount on their automobile insurance premiums. In some cases, participants receive a discount just for signing up for the app and are given the opportunity to earn additional discounts when they renew their policy.

WHAT’S IN IT FOR THE POLICYHOLDER?

In addition to potential premium discounts, this technology may provide peace of mind for parents with teenage drivers in the house. Some apps allow the primary policyholder, typically a parent, the ability to see the scores of their young drivers so they know if they are practicing safe habits. Parents can observe those scores and address risky driving behavior as they choose.

HOW DO I GET MORE INFORMATION?

Each company with this technology uses it differently, so give our agency a call to see if telematics are offered by your insurer. Cincinnati Insurance policyholders may choose to use RideWell, a smartphone app. Discounts can be up to 18% and if you are worried that the company may increase your rates, that can not happen. This is to help lower rates, not increase them.

Coverages described here are in the most general terms and are subject to actual policy conditions and exclusions. For actual coverage wording, conditions and exclusions, refer to the policy or contact our agency.