Use Technology to Personalize your Auto Premiums
What you pay for auto insurance depends on what and how much you drive, where you live, and your overall driving record. If you get into an accident or get a speeding ticket, your rates can often go up. But with telematics, a relatively new technology, you have the chance to improve your safe-driving habits and earn some impressive insurance discounts.
What is telematics?
You’ve probably seen advertisements for telematics devices on TV. Telematics can either be a smartphone app, a device plugged into a cigarette lighter, or a small, rectangular box that you slide into your car’s onboard diagnostic port (also called an OBD-II port). This port is usually directly below the steering wheel column.
When you enable a telematics device or app, it will capture and score your driving behavior and then send the data to your insurance company via data, Wi-Fi, or cellular networks. Different telematics programs record different data, but most track driving activity such as fast starts and hard breaking while also recording when and how far you drive.
Safe driving habits can lead to substantial savings while risky driving could result in higher premiums with some insurance companies.
Ask questions
Before giving your insurance provider the okay to monitor your driving habits, ask what information they will be collecting, if that data will be shared with any outside companies, and if you can decline to participate after you’ve begun the program.
Bonus benefits
Beyond encouraging safe driving, telematics is already helping insurance companies better investigate accidents and send for help after a crash. In some cases, you could be offered an online portal to view your driving habits. With that data, you could find ways to add safety to your daily commute or coach young drivers to improve their driving habits.
Personalize your rate
Telematics offers a chance to personalize your premiums based on your actual driving style. The safer you and your family drive, the more you could save.