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What is Telematics?

What is Telematics?

Telematics – Car Insurance for the 21st Century

Telematics insurance goes under multiple names – smart-box insurance, black box insurance or usage based insurance. They all mean the same thing and the core technology is the same throughout. In this article, we’ll discuss the concept of Telematics Insurance and how it works.

What exactly is Telematics Insurance?

It is a new but popular kind of vehicle insurance that can turn out to be much more affordable than traditional car insurance. Traditional motor vehicle insurance only takes into account a small number of factors, including age, occupation and claims records, such as how often claims are made and how much they cost. Rating models are then designed based on these numbers from the general public, and not based on individual driving patterns. But things are changing now, thanks to the introduction of telematics car insurance. A telematics system consists of a vehicle tracking device installed in your car, which provides specific data on your driving behaviour. The device uses the following technology to collect and transmit the driving data:
  • GPS: to determine the distance driven and the speed of the vehicle
  • Accelerometer: to gather data on acceleration, braking, and potential impacts due to accidents
  • SIM Card: to transfer the data to the database
  • Software Dashboard: to process and analyze the driving data and present it in a usable format
Telematics technology is actually not that new, and it has been proven to be quite reliable and efficient in markets all over the world. It’s just new to the Jamaican Insurance Industry, and at IronRock, we are proud to be the very 1st insurer in Jamaica to provide a telematics based product. Our new Pay As You Drive (PAYD) Policy can provide incredible savings that are actually based on your personalized Driving Score. If you want to learn more about our policy, just click here to see all the great benefits you can get by switching to a Telematics Policy.

How Does Telematics Car Insurance Work?

As mentioned above, Telematics Insurance involves fitting a smart device into your vehicle that can measure how well you drive. It allows insurance companies to know the exact performance of a driver or vehicle. This information can help determine premium rates or premium refunds based on good driving. Telematics insurance works by keeping an eye on a vehicle’s movement through GPS. It typically takes the following into consideration:
  • The distance you’ve driven
  • Your cornering
  • How you accelerate
  • How you apply the brakes
  • The times you drive
The main purpose of the policy is to identify and reward careful drivers, while also making roads safer by incentivizing drivers to be more cautious on the road. Drivers can use the device to prove how safe they are, and therefore ensure that they only pay what they should pay – instead of paying based on how everyone else drives. Telematics solves a myriad of car insurance related problems. It helps companies cater more specifically to each client, especially those who find car insurance expensive, as it allows them to save money. Also, the system will usually allow you access to your data so that you can have a clear understanding of how you drive and work to improve your record. Most systems come with an easy-to-use app that provides valuable data, such as trip history and vehicle alerts.

Who Is It For?

Telematics can be great for all kinds of drivers, especially young drivers, inexperienced drivers, and infrequent drivers who do not have a very high annual mileage. Even experienced drivers can use it to improve their skills and obtain more affordable insurance. We all know that car insurance can be very expensive and difficult for young and new drivers, as they are seen as inexperienced and therefore pose a greater risk to insurers. Telematics insurance can greatly assist with managing this exposure by ensuring young & inexperienced drivers get rates based on their individual driving behavior. People with multiple vehicles or that do not have very high mileage can also benefit from Telematics, as a major part of the driving behavior is dependent on how much you drive. Therefore, by reducing your time on the road and proving it with the device installed, you could be experiencing significant savings on your motor insurance policy. The truth is, Telematics Insurance can be for anyone who needs to buy car insurance. If you are looking for a way to truly personalize your policy and to stop paying rates based on all the bad drivers on the road, then Telematics may be for you. Get in touch with us today to learn more about our Telematics Policy and how it works. You can call us at 876-656-8000 to speak to an underwriter, or click here to get more information on our Pay As You Drive policy.


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