The spy on the dashboard
11/05/17 What are you willing to do to get cheap insurance?
Telematics systems are big news right now. These ‘black boxes’ are fitted to your car and monitor a range of things, from where you are, your behaviour while driving, the speed you travel and other factors too.
Telematics systems were first introduced a number of years ago as a way to help drivers who insurance companies considered to be a higher risk (mainly young men) get lower insurance. There wasn’t a massive take up of these deals at first, despite the high cost of insurance premiums for the ‘at risk’ drivers – largely because fitting the system involved drilling holes in your dashboard!
But flash forward to the present day and telematics systems are becoming more and more common. It’s estimated that by 2020, half of all cars on the road will have the system fitted. Fitting telematics systems is no longer so invasive, and at the moment, insurers are offering lower premiums as an incentive to sign up for the schemes. Around half of the cheapest quotes on the web for younger drivers are dependent on having a telematics system in place.
What are you signing up for – and will you have a choice soon?
A number of groups that campaign for privacy rights have raised concerns about the growth in telematics systems, which coupled with GPS are basically tracking devices. There are concerns over who has access to the information the devices record and a wider issue about what happens if you want to opt out of using the system. It seems likely that insurers will impose higher premiums for people choosing not to use telematics in the future or might even refuse to insure them.
There are also concerns about cars you might have as part of your job. Do you want your employer checking up on you every step of the way? If you take a diversion or drive too fast (within the law) could you face disciplinary action?
At present, it’s too early to be able to definitively answer these questions. But it’s worthwhile considering the options and asking questions about your data, how it’s stored, who it’s shared with – and if you can control what the system records and reports.
So how does it work?
Most telematics providers say that they give their policyholders a score at “how well” they drive, encouraging young drivers, in particular, to drive well. There’s no particular definitive guide to what insurers record, but as with anything involving insurance, there’s quite a bit here that’s ambiguous or open to interpretation.
Typical telematics policies will analyse speed, how you take corners, how hard you brake, acceleration and the time of day you drive. Some insurers analyse the roads you tend to drive on and cross references your driving with standard measures.
There’s evidence to suggest that telematics is really helping to reduce accidents. And careful drivers will be rewarded with lower premiums and other benefits. So, there are many positives.
But telematics systems are not infallible. There have been problems assessing risks with older drivers for example. And given that around a third of accidents are as a result of distraction, this data won’t be noted by existing systems. But as the technology develops, this will change.
The Clarkson factor
Ultimately, telematics systems are here to stay. But the civil liberties issues – as well as the freedom to drive responsibly in your own way – need to be debated.
Most drivers will concede to breaking a speed limit on the motorway or will complain about increasing restrictions in towns and cities. So, telematics systems will be treated with a great deal of suspicion. But is a system that makes us take fewer risks a bad thing? And will a level playing field make us all better drivers?
The debate is likely to rage for some time.
Do you have a telematics system? Let us know what you think of it. If you’d like to tell us your stories or make a point about telematics, get in touch: email@example.com or follow us on Facebook and Twitter and join the conversation.