Benefits of Telematics
Telematics and usage-based insurance offer several benefits to drivers, including:
The potential for cheaper rates
Good drivers are more likely to receive cheaper rates with usage-based insurance. If you’re consistently safe behind the wheel, you can see your rates go down, sometimes significantly.
More awareness about your driving habits
If you regularly commute to the same location — say, an office or a friend’s house — your brain may go on autopilot since you’re familiar with the route. As a result, you may speed a bit more or brake more frequently because you’re so used to the road.
Since your telematics app provides updates on your driving habits, you’ll become more aware about your tendencies. Knowing you tend to speed on a certain stretch of road could help with your long-term safety.
A fairer approach
Most traditional insurance premiums also consider non-driving factors, such as your age, gender, credit score, and location. While telematics can also incorporate those factors, it mostly uses driving-related data to determine how much you’ll pay, which eliminates some of the unfairness of traditional plans.
A positive environmental impact
Because part of your premium comes from how regularly you drive, you may decide to forgo using your vehicle sometimes. Perhaps you’ll walk to a nearby destination or bike to work once a week.
Those decisions to drive less frequently add up to a better impact on the environment since, a reduced chance of getting into a car accident, and a longer life for your vehicle.