Why FullyLinking Your Car Insurance Is Essential
Connected car insurance is an internet-oriented technology-driven vehicle insurance leveraging the Internet of Things (IoT where premium rates are based on driver behaviour. Connected car insurance plans are designed to reward and encourage safer and more careful driving behaviour, while enabling car owners to get potential savings and discounts on their monthly automobile insurance premiums. The insurance industry has responded to consumer demand by developing and creating several new insurance products such as 'smart' or interactive cars; anti-theft systems; satellite navigation; airbags; and wireless internet for phones. Additionally, several auto insurers have introduced several new driver demographics - senior citizens, retirees, students and people with colour vision problems. As well as all these technological advances, many consumers would also like to see their premiums reduced for good driving habits.
With these technological developments, it makes sense that auto insurers would develop and produce a policy that rewards good driving habits. In other words, a good driving habits insurance plan would reward good usage-based behaviours such as: safe usage rates and low annual mileage. Safe usage-based policies reward drivers for usage that reduces the risk of claim involvement. Thus, safe usage-based policies reward good driving habits such as: safe daytime driving, cautious driving, regular use of auto courtesy lights, and proper parking techniques. Good usage-based policies also reward good policyholders with low premiums. Thus, a good policyholder may also receive financial incentives for good policyholder behaviour.
To understand how usage-based policies work and how they reward good driving habits, it's first important to understand how auto insurers decide who is granted driver status and/or how they decide what level of driver safety is necessary to grant driver status. Automobile insurance companies are operating in a highly competitive market - in other words, there are hundreds of insurers competing for your business! egginsurance provides the incentive for insurers to provide competitive rates and services. This means that driver safety, low annual mileage and the safe use of a vehicle are some of the main considerations that affect how insurers rate and price their products.
Safety features on vehicles have been increasing over the last few years. Newer vehicles now offer front and side airbags, as well as seat belts and vehicle stability control. While these safety features certainly help save lives and reduce the risk of injury for all drivers, they do not account for every vehicle accident or crash. Insurance companies need real-time information about the driving behaviour of individual drivers - what they are doing in the moments leading up to an accident and how they act afterwards. Insurers therefore developed a special type of technology known as connected car insurance.
The connected car insurance system is designed to give insurers real-time information about driver behaviour that will reduce the likelihood that a driver will be involved in a motor accident and will also reduce the cost of a claim when the same driver is involved in an accident caused by another driver's 'natural' dangerous driving behaviour. The system works by collecting data such as road speed, engine speed, braking distance and other relevant information. Once this data has been collated, it is fed through a complex series of calculations and algorithms to give the most accurate estimates of driver behaviour and road conditions. For example, if a driver is travelling at a very fast rate of speed (which is common in high speed driving environments such as motorway driving) the likelihood of the vehicle striking another vehicle is greater than it would be for a driver travelling at a slower rate. As a result the speed limit on the roads is increased to help prevent traffic accidents caused by 'natural' risky driving behaviours.
The use of this new data collection and analysis system are proving extremely beneficial to both motorists and insurers. The reduced risk to both the driver and the insurer means that premiums can be kept low. By gathering and analyzing the data automatically, insurers are able to reduce the number of claims that they pay out and so lose out on a share of the overall cost of running the business. Insurers who use Connected Car Insurance technology can therefore save considerable sums on running their business and have more money available to spend on improving customer service and other areas important to them. It is little wonder then that car dealers and car manufacturers are lining up to benefit from the increased efficiency and lower claims rate that a fully linked system provides.
One of the key ways that fully linked car insurance policies work is that they allow the company to make better use of the information that has been collected and collated and are then able to develop specific policy options for different drivers and circumstances. For example, if a young lady who is going on her maiden trip without any previous driving experience comes along to drive a car that has a higher maximum speed, it could well be that she will not remain conscious and cause an accident that could prove fatal. A fully linked insurance policy would then be able to offer her a more sensible option of a slower vehicle that she could sit behind instead of being thrown around in the back of a big lorry. The same thing could happen if she were to take on a new partner driving a vehicle that is much larger than she currently owns.
Fully-linked car insurance also takes into account the drivers' usage-based factors. These are variables such as the number of miles driven, the frequency of use of the vehicle and the type of use such as whether it is used for work or pleasure. The insurers then take into account whether the drivers maintain a good driving record by looking at their credit score and whether they are making any claims on their policy. If they find that drivers do not keep to a good driving record, they will then take into account factors such as their age and their gender which are considered to be risk factors. This is one way that fully-connected car insurance helps to provide security and cover for everyone who uses a vehicle.
