Telematics Data Can Earn Insurance Discounts For Fleets

By Cheryl Knight, contributing writer

Telematics is used by many fleets — now, according to a FleetOwner article, insurance companies are getting in on the telematics trend. They are offering customers lower prices on insurance premiums for safe-driving practices — practices determined through the use of telematics solutions, such as those that use GPS.

This movement by insurance companies to use telematics technologies in the truck insurance market is further supported by a LexisNexis white paper on the subject. Some of the findings presented in the paper include the fact that 72 percent of fleet managers would be more likely to enroll in usage-based insurance (UBI) when offered a three-month trial.

“Two-thirds of small fleet managers shop for insurance every two years or more,” according to Ernie Feirer, VP and GM of Commercial Insurance at LexisNexis. “These fleet managers are looking for ways to save money, and our study shows 27 percent of them would sign up for a UBI program. This leaves a lot of room for growth and a huge opportunity for carriers offering UBI.”

How Telematics Can Help Lower Insurance Costs

Insurance companies are utilizing telematics to lower a company’s costs by tracking the vehicle using onboard GPS. They look for such information as vehicle location, movement, status, and behavior. The hope initially was to increase the productivity of workers, get a better handle on fuel costs, improve overall safety, and give a better customer service experience.  Another benefit of being able to track a fleet is the ability to evaluate the driving habits of individual drivers. Those deemed a good risk can thus lower their insurance costs and save money. On the other hand, bad driving can increase the cost of insurance.

Field Service And The ROI From Telematics

VARs can monitor this growing trend and help clients save money. And while there is an initial cost to install such technology, the return on investment (ROI) in insurance premiums savings can far outstrip that cost. Telematics have the further benefit of showing clients how they can make their operations more efficient, saving them even more.