Ronald Gitelman, CAFM: Leverage Telematics To Reduce Insurance Costs

By Ronald Gitelman, CAFM, Fleet Coordinator, Yale University

Fleet telematics have many beneficial uses including logistics, utilization, tracking, and fuel fraud detection. Yet many overlook potential insurance cost savings that could be derived from the data. Speeding, hard braking and acceleration, location ID, and landmark information can assist both the organization and the insurance company in realizing cost savings.

Driver Behavior impacts insurance costs regardless of the organization’s insurance structure. Harsh acceleration and sudden stops may identify distracted driving issues. Speeding may indicate reckless driving. Some telematics vendors offer sensors that can track whether the driver is using their seatbelt. As technology continues to advance options to disable communications devices while driving will become commonplace and distracted driving may decrease substantially.

Your company’s vehicles, especially if there is a company logo affixed, could easily become someone
else’s cash cow through false claims or exaggerating crash consequences.

Location Identification through telematics helps prove whether the vehicle was in the location, what its speed was prior to the accident, and whether driver behavior was an issue. This information can reduce claim amounts and safeguard future insurance costs.

GPS Tracking is very useful in locating stolen or carjacked vehicles. The fleet manager knows the vehicle has tracking but the thief likely doesn’t know. Speaking from personal experience, Yale has used our telematics equipment to locate stolen vehicles and minimize damage.

Speed Data provides significant information to your organization via a reduction of illegitimate injury claims. This information assists the management of reckless driver behavior before it becomes an issue, not to mention inherent scheduling and logistics benefits.

Location Tracking and Landmarks also allow organizations to monitor time spent at stops to ensure drivers aren’t misusing company resources or extending times at a work site. Alerts notify organizations when a vehicle enters and leaves an area, providing a data trail to verify the vehicle is authorized to be in the area and at what time. Through telematics, an organization can ensure drivers aren’t frequently driving through high-risk areas.

One last consideration: Is your organization self-insured or does it use a commercial insurer? Self -insured organizations seek to reduce claims because the payments up to a certain amount are paid out of the organization’s funds. Anything above the limit is usually handled through a commercial insurer.

Organizations that primarily use a commercial insurer do so to reduce claims and keep premiums manageable. Large claims or numerous claims can increase both out-of-pocket costs as well as premium costs in the future.

If your organization desires to reduce insurance costs, work with your insurer to leverage your technology’s benefits. These can offer a wealth of data that maximize savings.