Amongst the various different types of insurance policies, one which has grown in popularity over recent years, is telematics insurance.
Therefore, you may be considering taking out a telematics insurance policy, but first want to understand the technology behind it – how does it work? How can it benefit you as a driver?
Read on, as this article will take you through how telematics insurance works and why you can benefit from becoming a policyholder of this kind.
If you’re interested in securing your quote for car insurance that prices your policy based on how much and how well you drive, explore more on how telematics works at Lemonade Car here.
How telematics insurance works
Telematics insurance uses particular location-based technology to provide extensive data surrounding various aspects of your driving behaviours.
The technology itself involves telecommunications and informatics. Telecommunications involves using things like phone lines, cellular networks, or cables to transmit information and data. With informatics, this is the system which is responsible for structuring the data that’s received.
When it comes to you and your car, telematics technology can usually be applied in the form of a chip installation, which can be put somewhere like your car windshield.
There are also insurers that now provide software for your phone, allowing the technology to transmit data as long as your location services are switched on.
Once the technology is installed, it will continuously analyze and report on various aspects of how you drive.
For instance, it will be able to assess the spee
d you’re driving against the legal limit of the road you’re on. Therefore, whether you’re driving safely or speeding, this will be noted by the telematics.
Also, it can provide data on how well you handle maneuvers, such as whether you’re approaching stop lines safely and in good time, or whether you’re braking harshly at the last minute.
With data like this being provided to your insurer, they can then adjust your premiums based off how well they can see you’re driving.
Since safer drivers are much less likely to have an accident, if you’re clearly driving to a high standard, your premiums can be lowered.
Why you can benefit from telematics insurance
Taking out a telematics insurance policy can bring a wide range of benefits to you as a driver. A few of them are:
- Premiums tailored to your specific driving standard
One of the main benefits of taking out a telematics insurance policy is that you can have your premiums adjusted to your specific driving standard, not that which is assumed of you.
For many driver demographics, insurance premiums will be much higher on average, since you’ll be more likely to have an accident, based off statistics. This applies heavily to drivers who are in a younger age range or have just passed their test.
However, with your telematics technology installed, your premiums won’t be solely based off your driver demographic, but tailored to your actual driving performance.
This way, you can easily show your insurer that you’re a safe driver, despite your age or the length of time you’ve held your license for, and you can therefore still receive lower premiums with a fairer system.
- Accurate tracking of your location
Another major benefit of telematics insurance is that you can have your location easily and more accurately shown when in need of assistance.
There are many instances where you could require roadside assistance, such as a time when your car has broken down or you’ve been involved in an accident with another driver or some property.
With its location-based technology, your telematics software will have a clear and accurate pinpoint of your location, and this can be a great way to get assistance to you much faster, without the need for you to try and identify your location yourself.
This is a key part of driver safety, since immediate assistance may be necessary to keep you or others around you safe, so the quicker assistance can arrive at your exact location, the better.
Telematics insurance uses expert technology to not only deliver you with an advanced method of tracking your driving, but also give you lower premiums that align with your driver behaviours.