Are we there yet?

Gerhard Sonnekus,Managing Executive: Claims at Oakhurst Insurance

Any driver who has had a long journey with a child has heard the dreaded words, “Are we there yet?”

How do you explain the concepts of time, speed, distance and the vagaries of road travel to a child who is only interested in the ice cream at the destination?

This falls into the same category of the question “What are the developing trends of future vehicle insurance with the use of telematics”? There will certainly be a significant reward at the end of the journey but the duration, extent and speed of the journey is subject to a number of variables.

The vanilla offering

The use of telematics devices appear to be developing along the following lines:

Firstly, the “vanilla” offering, known as the vehicle theft recovery system, has been around for some time and has achieved substantial success. Almost invariably a third party installation and, being aimed at theft prevention or recovery of the item, it is de rigueur for the telematics device to be deeply installed.

Whilst widely used by insurers, it is also true that determined motor vehicle thieves, who have the will and the acumen to extract the device, all too frequently succeed in their efforts with only the device being recovered but not the vehicle. However, these installations require considerable technical skill and still play a very important role in curbing the cost of vehicle theft.

The ice lolly

Secondly, as an alternative to the “vanilla” option is the “ice lolly” solution. These are also third party offerings, although not aimed at theft recovery and therefore not subject to a deep installation. They are aimed at value added services mostly with “pay as you go” insurance packages being the primary focus.

The device can either be left in the vehicle indefinitely or, once the driver’s behaviour has been sufficiently “mapped” and the appropriate premium has been determined, the device can be returned to the insurer or third party provider. Quick and easy to install and uninstall, these devices provide a limited function at very little inconvenience to the consumer and far less cost to the insurer or third party installer.

Value added services

Thirdly, there is the “vanilla plus flake” offering, which are third party installations not only offering theft prevention or recovery targeted, but certain value added services. These include early crash detection; emergency assistance and monitoring of driving behaviour. These installations, however, come with the cost and complexity associated with deep installations.

A fourth offering (let us call it the “chocolate chip”) is that of a tracking device embedded in the vehicle at the point of manufacturing. This is currently still restricted to higher value vehicles. The benefit of this is the complete integration into the vehicle’s wiring loom and electronic facilities so that the work of the thief becomes exponentially more complicated.

Not only can such systems provide excellent vehicle tracking and theft recovery, but also granular information of the vehicle’s mechanics, electronics and driver behaviour patterns. This solution may prove invaluable in determining liability in litigation matters between opposing drivers.

Finally, there is the “blueberry cheesecake and fudge with all the toppings” offering. This is an embedded telematics device that is not only integrated with the vehicle’s mechanics and electronics, but also the infrastructure around it. Vehicles will communicate with each other, their drivers, traffic signs, public information services, social media, and emergency services. As a result, they will probably be accident free (mostly) and will also become mobile communication devices.

As technology continues to evolve, the use of telematics devices will continue to develop along the lines.