Fleet News

Telematics: the insurance issue

John Catling, CEO at FMG, looks at the role of insurance in the telematics marketplace.

 

As a direct point of contact between the insurer and the insured, during the incident management process, we see a unique viewpoint. As such, it’s clear to us that getting the right processes and technologies to help manage claims, from FNOL through to resolution, is vital. Telemetry adds another dimension to this – something which is still seen by some, as a complicating factor.

Over recent years, much has been made of the impact that telemetry is set to make on the motor insurance market. But businesses are still not utilising this tool to its full potential, to more accurately tailor their premiums.

Adoption of the technology has been surprisingly slow. Businesses are a prime candidate to benefit though, as telemetry can be used to improve driver performance across the board, more accurately tailoring a policy, whilst saving cost for business and reducing risk for insurers.

There is, understandably, some scepticism, which is affecting business uptake. The ‘spy in the car’ perception can easily be overcome, as the more astute businesses see telemetry as a carrot, not a stick. In our experience, even the competitive nature of a simple driver ranking has been enough to see wholesale improvements in driving performance across a business.

‘Big data’ is also offered up as a reason for nervousness amongst businesses and insurers. It’s vital that data is held securely and the right systems, accreditations and processes are in place to manage this. 

Analysis is also key. The old saying of: ‘if you can’t measure it, you can’t manage it’ rings true. Having the right system in place to quickly and accurately sort data into the parameters, relevant to a certain business, is vital to success. Making the claims process simpler is a goal we all share.

Perceptions are slowly changing, as technology is advancing. Smarter telemetry devices are now configured for crash detection, which has obvious benefits in countering the recurrent problem of insurance fraud.

Whilst some ‘boxes’ on the market are little more than a collection of wires and circuits, designed as a deterrent rather than a solution, technology is driving change.

Telemetry is proven to have led to impressive results in major fleets, whilst allowing insurers and customers to more accurately define their premiums. Business uptake is starting to move in the right direction, showing increasing confidence in the technology.

It’s worth noting that there is a shift of emphasis, rather than a wholesale shift in the profitability of telemetry based insurance. Technology is allowing a fairer system, and more accurate insurance premiums alongside that.


Click here for telematics best practice and procurement insight

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Comments

  • Keith Hooson - 31/01/2014 14:27

    Tracking data like nuclear power can be used for good and evil! What would a company and/or insurer do if a third party claimant asked for all data collected during tracking in relation to a claim? That data could reveal a lot about a driver's behaviour pre any incident, good, bad and indifferent. Tracking data to an inquisitive mind, forensic investigator and claiment could be extremely valueable.

  • Mark Pearson - 03/02/2014 15:34

    A balanced proposition that gives a business key measurable data and gives a driver a safety first but rewarding user experience is the recipe for success in this field. Look out for our sophisticated smartphone solution in 2014! www.wejo.co.uk

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