It should come as no surprise that your car insurance company knows a lot about you, but just how much can be a little shocking. Major insurers gather and analyze a lot of factors to determine your rate. Everything from obvious things like your age, gender, the car you drive, and your claims and accident history, to the more unexpected like where you live, your marital status and sometimes even your credit score are considered to set your rate.
However, these days, there’s a new piece of data available for insurance companies to factor in.
In the past few years, your carrier may have sent you a small tracking device to install in your car or asked you to download a tracking app to your phone for a chance to save some money on your insurance. These driver tracking apps are called telematics. Telematics is a black box technology used to transmit your driving data in real-time to your insurance carrier to help determine your rate.
How It Works
It’s simple, really. Drivers either download an app or the insurance company will mail a device for you to install in your car. This device will monitor and track how you drive – using technology similar to how map apps on your phone know where you are in order to give you directions.
To gain enough information and learn how you really drive, insurers have a data collection period lasting anywhere from a few weeks to several months. After this trial period is over, your insurer will decide if you’re a good driver and you could get a reduction in your rate. But if they determine you aren’t a good driver, your rates could go up.
What They’re Looking For
The driving habits that they’re looking for are pretty straightforward — your car’s speed being the most obvious. Even if you never get a ticket, your car insurance company will know when you’re breaking the speed limit and can penalize you via higher rates.
Another habit they look for is sudden stopping. If you’re constantly braking quickly, it could mean you’re not paying attention, tailgating, or having trouble decelerating, all of which can negatively affect your rate.
One data point they use that you probably can’t control is drive time. If you spend more time on the road, you’re more likely to get into an accident (and cost them money). So even if you’re a perfect driver, if you have a long daily commute, or regularly drive to visit friends or family who live far away, a telematic program could end up costing you.
Another thing insurance companies are looking for that might come as a surprise is the time of day you drive. At night, visibility is reduced, making driving more dangerous in general. And as the night wears on, even if you’re straight as an arrow and wide awake, other drivers have a much higher chance of being under the influence or just plain sleepy. If your schedule requires you to drive at night, especially late at night, a driver tracking app could leave you with higher-than-expected insurance rates.
Who’s It Good For?
The simple answer is good drivers. If you keep it between the lines and under the speed limit, you should be getting a discount with a telematic program. Especially if you’re young, have bad credit, or have any other factor on your record that will raise your rates right away, having a telematic program prove you are a good driver will help counteract those strikes against you. (To learn more about what factors companies use to calculate your insurance score, click here.)
The problem lies in the fact that most of us think we’re good drivers, and this just isn’t true.
While 73% of Americans consider themselves good drivers, 90% of crashes come from human error (stats). Those stats just don’t add up. So while a telematic program may seem like a no-brainer, it’s probably best to know for certain what kind of driver you are first.
Am I A Good Driver?
The easiest way to see how insurance companies monitor your driving is with Semo Drive. You download the app just like you would an insurance company’s app, then drive normally. However, this time, instead of your information being sent to an insurer, it’s collected for your use.
After a few weeks, you can review the easy-to-read data and learn your driving patterns to discover how good a driver you really are, or see areas to improve. Most importantly, you can learn how an insurance company sees your driving habits before they do.
Use Your Data
Insurance companies have a ton of information about you already. Monitoring how you drive with telematics is just the next logical step. However, unlike most of the data that insurance companies factor into your car insurance rate, it’s one you can actively decide to share or not.
With Semo Drive, you get insight into how a car insurance company judges your driving habits and the ability to use this information for your benefit. Sign up confidently, work to improve, or don’t sign up at all. Whatever is best for you, you’ll know when you test with Semo before telling your insurance company.
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