BMW’s proposed move into telematics has got the industry talking again
- BMW is in talks with telematics providers with plans to install their technology in its new cars from 2015
- The car manufacturer is several months into the discussions
- This could see cars leave the production line in future ready to join insurer telematic schemes straightaway
- Telematics software would help BMW keep track of the condition of its cars, as well as provide rating information for insurers
The key questions
Which insurers have shown interest in telematics-based cover in the past?
Allianz, Equity Red Star and Groupama were trialling policies for cars fitted with telematics from January 2009. Markerstudy began to show an interest in late 2009, but the biggest pilot telematics scheme, involving 5,000 drivers, was launched by Aviva in 2004.
Why has the idea taken so long to get started?
One reason is a slow uptake from customers, some of whom were concerned about what was seen as intrusive monitoring by insurers. Another reason was that car manufacturers were slow to adopt the technology. Additionally, the cost of fitting and running telematics boxes put some insurers off.
What could the future of telematics look like?
Several telematics providers are working on projects that would help consumers, such as apps on smartphones that could give driving advice in real time.
What are the benefits for consumers?
Policyholders that are good drivers can benefit from lower premiums. Around 90% of drivers on the Co-operative Insurance Young Drivers scheme have been paid rebates on their premiums after having telematics boxes fitted in their cars.
●With the ECJ gender ruling set to increase average motor premiums for women from 2012, insurers that can offer them lower premiums based on telematics will surely snap up market share quickly
● Building telematics software into new cars can only be a good thing, as it will help with rating, fuel efficiency, diagnostics and tackling motor fraud