Telematics and Fleet Insurance

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July 12, 2019

With a growing fleet comes growing expenses. The more vehicles and drivers in your fleet, the higher your insurance premiums will be become. However, for many companies, insurance premiums can be discounted for fleets that engage in safety programs and maintain compliance with federal regulations.

Using telematics technology and driving data has become an undeniable factor in simplifying fleet management, and can help fleet managers ease growing pains and reduce the cost of insurance premiums as they grow their business.

8 ways to save money on telematics fleet insurance costs

  1. Developing A Culture of Safety
    Accidents and safety violations are most commonly the leading factor auto insurance companies use to determine insurance quotes and premiums. Companies that actively develop, engage, and promote a strong safety culture are proven to have fewer and less severe accidents1. By implementing high expectations for safety behaviors throughout an entire organization, carriers and fleet managers are able to establish accountability to keep drivers safe.

    Driver management software gives fleet managers and drivers insight into aggressive driving behaviors including speeding, hard braking, and rapid acceleration. Managers are notified of any incidents in real time so measures can be taken,and drivers receive a scorecard of their driving behaviors, making it easy to identify areas for improvement and encourage better driving habits.
  2. Improving CSA Scores
    As drivers and employees become focused on improving safety records and driving behaviors, it’s likely that carrier CSA (Compliance, Safety, Accountability) scores will improve. CSA is an FMCSA initiative that grades commercial carriers based on safety-related factors. The score is based on inspection results, violations and crashes across an entire fleet, and high CSA scores can impact car insurance premiums in the worst way.
  3. Utilization and Vehicle Maintenance
    For fleet managers, it is important to consider the cost of car insurance before adding new vehicles to your fleet. The more expensive the vehicle, the more it will cost to insure. Some agencies recommend purchasing used vehicles over new ones and opting for lighter weight trucks to keep costs down.

    Additionally, keeping up with preventative maintenance and repairs on all of your vehicles can also help extend the value of your fleet—and assist when negotiating insurance premiums. Taking even one vehicle out of service comes at a price to your overall productivity (and by extension, your bottom line), but being short-sighted about routine maintenance or needed repairs can also extract a price down the road in the form of higher insurance.
  4. Helping to Eliminate Unauthorized Vehicle Use
    Telematics devices, also known as black boxes, can be added on any asset within your fleet, providing full visibility into all of your high-value equipment and making it easy to locate equipment quickly when it’s needed most.

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    Telematics data can also help you identify and eliminate costly unauthorized motor vehicle use. With geofences, you can create virtual boundaries around buildings, job sites, and other key locations to track company vehicles at any time of day. You can see if vehicles are being used outside of work hours or on weekends, or if your drivers are taking vehicles to unauthorized locations that may put your fleet at risk.
  5. Reducing Theft
    Vehicle tracking software enabled with tamper-proof telematics devices also helps reduce theft or recover stolen vehicles. Instant GPS tracking alerts allow fleet managers to notify law enforcement of unauthorized use as soon as it happens—which can reduce total damage and speed up asset recovery; and reducing or eliminating asset theft also prevents costly insurance claims that can impact your bottom line.
  6. Providing Proof of Compliance
    DOT compliance, including hours-of-service rules (HOS), the ELD mandate and driver vehicle inspection reports (DVIRs), affects more than three million commercial drivers in North America. Most insurance companies provide a standard discount for proof of compliance with federal and state mandates. Telematics programs make it easy to track compliance in one integrated system, simplifying administrative processes and reducing costly fines from the DOT.
  7. Video Evidence You Can Trust
    Fleet software provides all of the data required to prove fault in any accidents and help to speed up the claims process. Integrated dash cams eliminate the need to sort through hours of footage looking for what happened in an incident, and behaviors are analyzed and categorized by smart, AI-backed technology. Fleet dash cams can also help show context, allowing the full picture of any incident to be viewed by drivers, fleet managers and insurance companies alike.
  8. Compiling Comprehensive Reports
    With the right telematics software, fleet managers can pull reports that show:
    • The number of incidents your fleet was involved in
    • How many drivers were penalized for aggressive driving
    • How many safe drivers make up your fleet
    • Proactive maintenance and service activities performed on your assets
    • And much more

All of this data is accessible in an easy-to-use report that can be used when negotiating rates with insurance providers for renewals.

Discounts for GPS tracking systems

Many insurance companies provide a discount just for having a GPS tracking system and dash cams in place for your fleet. Some auto insurers also offer usage-based insurance (UBI) programs that track the number of miles driven and driving behavior to inform rates.

These 8 tactics are just some of the things a company can do to lower insurance premiums on its vehicle fleet. However, some insurance providers extend discounts to companies with Verizon Connect installed. “The bigger our fleet got, the larger the insurance plan got,” said Mr. Rohrer of Rohrer’s One Hour Heating and Air Conditioning. “We needed to make sure we were doing everything we could to keep insurance costs low.”

Check with your auto insurer for more information on insurance program discounts, or talk to us to see how our solutions can help you run a more cost effective fleet.

Sources

1 https://rosap.ntl.bts.gov/view/dot/32538/dot_32538_DS1.pdf

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