It’s being dubbed ‘Creepy Car Insurance’ and it’s got industry insiders talking. What is it? We’re referring to a small monitoring device placed in your car that tells you when, how far and how fast you’re driving…
Big Brother’s Watching You!
Sounds like Big Brother’s watching you? Some might think so but insurance companies reckon it’s the future and could save you money and so much more.
Australia’s Progressive Insurance company is just one of many that is already offering this usage-based car insurance, inviting customers to install, what they call, ‘The Snapshot’. The better you drive and the less you drive, the more you save on your premium. The average Progressive customer can make a saving of about 10 per cent.
Saving you money, however, is not the only draw. The little device, also known as telematics, could ultimately save thousands of lives and the planet too! BIG claims for a small box eh….?
A US study called the Hamilton Project found that usage-based insurance would have a massive impact on the environment and resources. The study found that charging by the mile would reduce driving by 8 percent in the states. Less driving means less oil used and fewer carbon emissions — 4 and 2 percent less, respectively. It also means less traffic and fewer accidents, which they estimate would save the US another $50-60 billion or thereabouts.
An Insider View
We caught up with the CEO of DirectAsia.com to find out whether telematics would work in Singapore.
Nicolas Faquet, CEO of DirectAsia.com HK, welcomes the idea but believes the market here is too small for this type of technology to be viable. He said:
“This is something we are not using in Singapore at this stage and do not plan to use in the near future as the market here is definitely too small for this type of technology. The economics just don’t work.”
But Faquet is not ruling it out altogether.
“It can’t work here until telematics becomes a built-in feature on most cars which is already happening on the continent. “It would possibly work for us if we could make use of existing telematics that the customer is happy to pay for because of another higher perceived value such as an SOS button (assistance) and in-built phones.”
Economics aside, the other issue at stake here is privacy. Some motorists are steering clear of the black box for this very reason, claiming it is too much of an intrusion into their lives.
Tell us what you think. Would you welcome the black box into your car to get a 10 per cent or so discount on your car insurance premium? Tell us what you think of the little ‘black box’? We want to hear your thoughts.
What is Telematics?
Telematics policies offer personalised insurance based on when and how YOU drive.
A telematics device can be installed into your car that measures how well you drive. Your premiums are then based on how safe a driver you are instead of paying for insurance based on the average driver.
How does Telematics work?
It tracks your vehicle’s movements through GPS systems and enables insurance providers to assess your driving ability. The following may be taken into consideration:
- your location
- how long you’ve been driving for
- how rapid or measured your acceleration is
- how harsh or smooth your braking is
- your cornering
For more info on Telematics