Telematics and Texas Auto Insurance
The auto insurance field is facing a lot of changes. For example, the concept of Big Data has transformed many different industries, and it is changing auto insurance too, through an idea called telematics. Telematics is a way for auto insurance companies to gather personalized data about your driving habits. If that data determines that you are a safe driver, you get discounts on your auto insurance policy. In this post, we’ll dive into how this works and what it means for you as a Texas driver.
The way telematics works is simple. You sign up for a program if your auto insurance company offers it. Then you get a small dongle in the main that plugs into your steering column or somewhere on the dashboard. This device tracks things like how rapidly you brake and accelerate, how tightly you turn, and what time of day you drive. It sends this information back to the auto insurance company. That company has an algorithm that it uses to translate this data into a measure of how safe a driver you are. If it determines that you are a safe driver, you get a discount. On the other hand, some companies are also rolling out the opposite feature- if you get an unsafe driver rating, you might pay a higher rate.
This system lets cheap auto insurance Texas companies get a detailed look at drivers and make an assessment of their likelihood of getting into an accident with more detail than ever before. It used to be the case that insurers couldn’t really tell much more than whether you have been in an accident before, and that’s not very informative. The telematics data shows how you actually drive, and that provides many more clues about whether you will get into an accident or not. It also rewards drivers for developing good driving habits, which promotes the health and safety of not only the drivers in the program but also everyone else on the road.
Of course, there are some privacy concerns. Some Texans might be distrustful of the idea that their driving data will be beamed to an insurance company. However, all telematics programs are completely opt-in and voluntary. They usually involve a discount for most drivers and a penalty for a few of them. So not only are you free to not participate if you do not want to do so, but just going by the numbers, if you do decide to participate you should expect your auto insurance to get cheaper.
Telematics is truly exciting because it means you can benefit from your own ability as a driver. You have always known that you are a careful and safe driver, and now your auto insurance company will know that too. They will reward your care with better rates. It is a win-win, because neither you nor the company wants you to get into an accident. Better information sharing means a safer road and cheaper insurance for all of the good drivers in Texas.