Trip monitor helps Canadian drivers slash insurance premiums

Have you ever thought how great it would be if your insurance company rep could accompany you on your drive to work – and then impressed by your careful driving offer you a substantial discount on your premium?

That’s not entirely pointless speculation.

Insurance firm Aviva Canada Inc. won’t be having their agents car pool with you anytime soon, but their Autograph Program could be the next best thing for drivers and business operators to shave serious dollars off their vehicle insurance premiums.

Launched in early in 2005, the program has reportedly helped more than 5,000 participants save as much as 25 per cent on their premiums.

The voluntary plan basically involves installing a matchbox-sized data gathering device on the participant’s vehicle or vehicles. Once plugged in, the gadget records several key indicators such as: time of day when the vehicle is driven, distance traveled, speed, and instances of so-called panic braking.

Every six months, participants unhook the device and plug it onto a computer to send the data via the Internet to Aviva.
The data collected helps Aviva determine how collision prone the person is. If a participant’s driving habits for a particular period indicate a degree of safeness, he or she is rewarded with a discount, says Paul Fletcher, senior vice-president of marketing for Aviva.

People who have signed up with the program are mostly individual drivers, but Fletcher believes it’s possible to attract small business operators. “Individual drivers are the primary focus of Autograph, but I can see how a home business owner or SMB operation can benefit with lower premiums for their company vehicles.”

The idea of using technology to track driver behaviour for energy savings and performance management objectives is far from ground breaking, Fletcher admits.

But he said the Autograph device – that uses pretty simple technology – can be an additional tool to help companies realize greater savings.

Small fleets can use this device much like larger operations already use GPS tracking gadgets to monitor their vehicles and determine energy saving driving practices, the Aviva executive said.

One long-time Toronto-based Autograph user says the program has not only helped him reduce insurance costs on his two vehicles, but has also encouraged him to adopt safer driving habits.

“Since installing Aviva, I don’t drive as fast as I used to and tend to stay further away from the vehicle in front of me,” says Alfred Engelhardt, manager of network quality assurance at Rogers Cable.

Engelhardt, who owns a Ford Edge crossover vehicle and a Ford F150 truck, said the Autograph program helped him cut as much as $300 off his annual $2,000 premium.

When the recording device is hooked up to a computer, Engelhardt can view on the monitor how his driving habits for the reporting period will affect his insurance premium.

He is then given an option to either proceed with sending the data to Aviva or forgo the reporting. If no report is submitted the insurance bill will reflect Engelhardt’s pre-Autograph fees.

“The thing I like about the program is that it’s voluntary. You don’t need to send in the report if you don’t like what you see.”

Over the years, Engelhardt, has learned that certain driving habits will merit “penalties”. For example, numerous instances of sudden braking, jack rabbit starts or driving at high speeds will tend to increase his premiums.

Engelhardt says he has learned to not to tailgate because this increases the chances of panic braking. He also keeps to the speed limit because driving above 110 Kmph tends to raise his premiums.

One Toronto-based home business operator agrees with Engelhardt’s view that awareness of the negative impact of one’s habits encourages change.

“When you can measure the results of your actions there’s a greater initiative and facility to fine tune them to achieve the desired results,” according to Leonard Machler, an independent bio-chemist research analyst.

Machler, however, is not an Autograph Program participant. He doesn’t drive at all and that’s because an energy consumption calculator has informed him that driving will increase his greenhouse gas (GHG) emission.

Since using the Web-based EcoAction Calculator developed by Earth Day Canada, Machler said he has been able to cut his GHG emissions from five tons to just above 2.5 tons and save thousands of dollars in energy costs in the process.

Most calculators focus on measuring waste and toxic materials such as garbage and waste water but the EcoAction Calculator also provides Machler with estimates of how much he can save by adjusting his habits.

For example, taking shorter showers and using public transportation rather than driving enables Machler save more money.

Monitoring devices designed to encourage more efficient behaviour are likely to be increasingly adopted in the transportation sector, says a Canadian technology analyst.

“The IT sector has been slow to adopt these technologies. Businesses that rely on a fleet of vehicles are more likely to use these devices because that is where pressure on fuel cost is most evident now,” said Aaron Hay, research consultant for Info-Tech Research Group in London, Ont.

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