Term
Telematics insurance (Usage-based motor insurance)
13 stories mention it
Telematics insurance is motor coverage priced from data collected on how, when and how far a vehicle is actually driven. Insurers gather it from a phone app, a plug-in device or the car's built-in sensors and use it to set or adjust premiums.
A telematics policy draws its price from data captured while the car is being driven — speed, braking, cornering, mileage and the time of day trips happen — rather than from static factors like a driver's age or postcode alone. The data comes from a smartphone app, a small plug-in device fitted to the car, or sensors built into the vehicle itself, and is sent back to the insurer or an intermediary that scores it before the policy is priced or renewed.
The approach exists because conventional rating factors are proxies for risk, while driving behavior is the risk itself, so insurers can reward safer driving directly instead of guessing from demographics. The hard parts are less about collecting the data than about doing something fair with it: deciding which behaviors actually predict claims, protecting driver privacy, and preventing a policyholder from driving carefully only while a test period is being scored.
In insurance technology this is where a lot of the plumbing lives: crash-detection algorithms that trigger a claim before the driver calls anyone, scoring engines that turn raw sensor streams into a premium adjustment, and integration layers that let telematics data providers plug their feeds into a carrier's underwriting and claims systems without a rebuild on either side.
Written by Insurtech Daily.
For the running coverage rather than the definition, see the Auto insurance and mobility hub. For the companies in this business, see auto insurance companies.
Companies in these stories
Telematics insurance in the news
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Germany Motor Insurance Market to Reach USD 67.43 Billion by 2031, as Digital Distribution, Telematics, and Comprehensive Cover Gain Ground
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Germany Motor Insurance Market to Reach USD 67.43 Billion by 2031, as Digital Distribution, Telematics, and Comprehensive Cover Gain Ground
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Europe Car Insurance Market to Reach USD 157.92 Billion by 2031, as Telematics, ADAS and Digital Insurance Shape Market Trends
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Europe Car Insurance Market to Reach USD 157.92 Billion by 2031, as Telematics, ADAS and Digital Insurance Shape Market Trends
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TrustLayer Brings the Telematics Model to Contractual Risk with Certified Risk Transfer™
You Do the Risk-Management Work. You Just Can’t Prove It — Yet. The case for Certified Risk Transfer™ There’s a business out there — maybe it’s yours — that does...
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Volvo launches new telematics app
Drivers of most Volvo cars from model year 2020 can soon download the app.
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Root targets US growth with latest telematics launch
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OCTO partners with Sedgwick on telematics claims solution
The offering is telematics-agnostic and is intended to reduce claims costs and processing times.
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Root Expands Its Telematics Car Insurance to New Jersey, Its 37th State
Technology-driven insurer Root has launched its behavior-based car insurance in New Jersey, marking its 37th state. Using mobile telematics, Root calculates its rates primarily on actual driving performance, such as…
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Why California's telematics bill leaves insurers guessing on AI
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Why Insurance Telematics Integrations Fail
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Cambridge Mobile Telematics and TransUnion launch portable driving scores
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Zego aims to reshape car insurance with telematics app