Telematics: what is it, and how can it make driving safer?

If you’ve never heard of the term “telematics,” you’re not alone.

Until recently, telematics was a technology used primarily by commercial businesses for tracking and managing fleets. Now, however, we’re seeing telematics emerge as a more mainstream consumer product.

Telematics refers to any device which merges telecommunications and informatics, and enables wireless data communication. The technology is designed to monitor the location, movement and behavior of an object (your vehicle) to ensure it’s safe and in good health. Think of it as “Find my iPhone,” Google Maps, Fitbit and other similar tracking apps, all rolled into one, but with your vehicle at the center.

Vehicles have sensors to monitor everything from tire pressure, to the air-fuel ratio, to monitoring blind spots. Vehicle manufacturers are adding more and more sensors to vehicles to monitor parts and components, changing the way drivers interact with their vehicles.

The use of telematics for consumers is growing fast. Analyst firm Gartner reports that about one in five vehicles on the road worldwide will have some form of wireless network connection by 2020. This means that there will be more than 250 million connected vehicles and a host of new opportunities for telematics. One major area for growth will be auto safety. Risk management solutions will take vehicle safety to the next level with recovery and crash discrimination features.

Some examples of benefits that telematics provide to improve driving safety include:

• Driver monitoring and analysis – With all the data that telematics devices can gather, including speed, accelerations, braking time and even lack of seat belt usage, concrete feedback around dangerous driving habits is one of the most basic benefits of telematics technology. Armed with this information, drivers can work to change their habits, decreasing the chance of an accident while making them more conscientious.
• Crash reporting systems – Crash reporting  systems can offer critical, life-saving benefits to a driver involved in a crash. If the driver is injured and unable to call for help, these systems can help notify authorities when needed. Additionally, first notice of loss (or FNOL to those in the insurance industry) can be fully automated through telematics, improving the speed and accuracy of the claims process for both the insurance provider and the policyholder.
• Stolen vehicle recovery services – Stolen Vehicle recovery services are a critical component of telematics. Every vehicle recovery service utilizes either GPS, cellular, radio frequency, or a combination of all three, to track and locate missing vehicles. These technologies provide drivers with peace of mind that their car may be recovered if stolen.
• Insurance discounts– Telematics can also provide financial advantages. Insurers like Liberty Mutual are offering discounts to drivers who use safe driving habits, using telematics technology that monitors for hard braking, rapid acceleration and other behaviors.

Auto companies will be able to collect data on a vehicle’s performance, remotely sending updates to vehicles while avoiding recalls related to the car’s software.

The consumer-oriented telematics services we’re seeing introduced today are just the beginning. Looking ahead, it’s exciting to think about the potential of these services to make driving safer and keep us more connected while we’re on the road.