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Monthly Archives: March 2021

Smartphones are problems, but here’s how they can help reduce driving risk

Experts predict that 2021 could be the year telematics driving data actually provides meaningful information — and change — to insurers and drivers alike, allowing risk to be underwritten more accurately. To pull that off, smartphones will be a critical tool despite their drawbacks.

Clients’ driving data has been available in some form for a number of years now, whether installed as a black box type of device in Europe or as a dongle through the OBD-II port in North America, but it hasn’t been necessarily easy to manage or put to great use, explained Ryan McMahon, vice president of insurance and global affairs at Cambridge Mobile Telematics during a recent P&C in 2021 – Market Catalysts webinar.

Telematics has been merely a data collection tool to this point. Going forward, it can be used for much more, such as providing feedback to the driver about their driving habits. That makes it much more helpful in terms of changing driving habits.

And it’s all thanks to one piece of technology: Smartphones. While they’ve created their own set of problems in regards to driving behaviour, McMahon said they’re changing the game when it comes to telematics and data usage.

“With the advent of smartphones, you have the ability to have that two-way conversation with a driver and provide feedback and that incentive to them,” Ryan said during the webinar. “And that has really changed the business model for a lot of carriers because they’ve moved away from a short-term monitoring period and gone to a continuous engagement-type program.”

The incentives part is crucial for the two-way discussion because the driver needs something in return for giving up their driving behaviour and having insurers, in essence, watching them, Mike Zaremski, P&C and insurtech investment analyst at Credit Suisse, said during the webinar. That financial reward can also be an incentive for them to change their driving behaviours.

McMahon agreed, saying that incentives can be regularly updated to match the desires of customers.

To find out more, visit: https://www.canadianunderwriter.ca/insurance/smartphones-are-problems-but-heres-how-they-can-help-reduce-driving-risk-1004202841/

P&C industry needs better data about distracted driving

According to a recent webinar panel, there’s a fairly significant gap between what government agencies have to say about distracted driving and what data companies are able to capture, and that is playing a role in the ineffective portrayal and messaging around the seriousness of people using their phones while operating vehicles.

In 2019, about one-third of all trips showed “significant phone distraction,” according to Cambridge Mobile Telematics’ (CMT) own data gathered through its applications. In 2020, which included nine months during the global pandemic, the number of trips where the driver was distracted by their phone went up to 40%.

In comparison. the U.S.-based National Highway Traffic Safety Administration reported in late 2019 that the percentage of passenger vehicle drivers talking on handheld phones increased from 2.9% in 2017 to 3.2% in 2018. Those visibly using headsets while driving dropped from 0.45% to 0.35%, while visible manipulation of handheld devices went up from 2% to 2.1% in the same time period.

According to the National Safety Council, about a quarter (26%) of all car crashes involved phone use, even hands-free devices. CAA reported in 2020 that its polling found that 47% of Canadians admitted to typing or using a voice-to-text feature to send a message while driving, whereas 33% said they did it at a stoplight. Furthermore, InsuranceHotline.com reported that 26% of drivers have checked messages while operating a car in motion while another 41% of Canadians said they are at least somewhat likely to check messages when stopped at a traffic light.

All of this suggests that government and advocacy agency data and telematics company data are far apart. If insurers want to see risk decrease, gathering better data and improving messaging around the perils of distracted driving is a must.

To review the full report, visit: https://www.canadianunderwriter.ca/insurance/pc-industry-needs-better-data-about-distracted-driving-1004203087/