So-called telematics tariffs can make vehicle insurance significantly cheaper. There is a discount of up to 30 percent. However, the owner pays with data instead of money.
Rainer Prestele from Düsseldorf is one of the people who, like many others, are annoyed by rising vehicle insurance prices. About a year ago he became aware of a so-called telematics tariff that he had never heard of before. 30 percent discount savings, that sounded convincing. “I didn’t even know what telematics meant,” he says. “So I thought I'd just try it out.”
“Pay as you drive”, translated: “Pay as you drive” – that is the motto of these telematics tariffs, which some insurers offer as a discount on existing car insurance. The special feature of the tariff: The insurer basically goes along for the ride and monitors whether the customer drives a car in a low-risk way. Since then, Prestele has been particularly careful when traveling. He sneaks behind a truck on the highway near Düsseldorf. In order to overtake, he explains, he has to accelerate sharply in order to merge into the middle lane in heavy rush-hour traffic. And telematics is probably taking a toll on him.
Driver data is anonymized and evaluated
The heart of the telematics technology is a sensor that customers receive from their insurance company and have to attach to the windshield. In conjunction with a smartphone app, the sensor registers how the user drives, how hard he accelerates or brakes, whether he adheres to speed limits, which routes he is traveling on and at what time of day.
This driving data is usually transmitted anonymously via mobile phone to external service providers. These calculate a so-called score, a point value that is intended to reflect how safely the driver was on the road. Based on the points achieved, the insurance company then decides whether there are discounts and calculates an individual premium, which is then taken into account in the next insurance year.
Insurers also save with telematics tariffs
Defensive driving can pay off and is rewarded with discounts. That sounds tempting; However, these tariffs currently lead a shadowy existence in the insurance market. Of the around 50 million registered cars in Germany, only a million or so are currently insured with a telematics tariff. The premium for motor vehicle liability rose by an average of 25 percent last year. Next year it will be even more expensive, by at least ten percent. In view of recent inflation, the share of telematics tariffs could increase significantly, we hear from the industry.
The market leader among providers is by far HUK-Coburg; almost half of all telematics customers are insured here. The company makes no secret of the fact that not only customers can benefit from the tariff module. Because: The fewer accidents, the less the insurer has to regulate. It is hoped that the tariff will have certain effects, explains the HUK; For example, customers' driving behavior changes so sustainably that fewer cases of damage occur. “This is actually good and advantageous for us,” says the provider.
Customers pay up to 40 percent less
But how should drivers behave in order to benefit from the telematics tariff? Marek Reimann shows this. He has been using the tariff for three years and shares his experiences online via his YouTube channel. He travels to his work in Berchtesgadener Land every day. Reimann has managed to adapt his driving habits so that he almost always achieves the highest possible score.
To do this, he says, you need to know what system is behind the tariff. Anyone who frequently accelerates quickly is considered an aggressive driver by the insurance company. Anyone who does not strictly adhere to speed limits is always a risk to others. Anyone who brakes sharply more often is suspected of causing rear-end collisions. Even cornering too quickly does not escape the sensors and is penalized with point deductions.
Reimann benefited greatly from the telematics tariff; he was able to gradually reduce his original insurance premium of around 470 euros per year, including a ten percent starting bonus, to around 290 euros: a saving of almost 40 percent. His advantage, he says, is that he knows the route well, which makes it relatively easy for him to drive ahead. And he lives in the country. There is less traffic there and therefore fewer accidents.
Little discount opportunities for commuters
This didn't work so convincingly for Rainer Prestele from Düsseldorf. The former accountant has carefully logged every telematics trip over the past two years. Result: despite all his efforts, he never reached the maximum discount. “I promised myself every time: Today you'll get full points. And I didn't even manage to do that,” he says.
He has a simple explanation for this: Prestele lives in a metropolitan area with many commuters. They often travel in the dark, especially at this time of year, and have to use routes that are considered accident hotspots. These factors are also taken into account in the evaluation, but negatively. But customers don't have any disadvantages: the premium doesn't become more expensive – even if the technology reveals a user to be a notorious speeder. Of course, he has no chance when it comes to discounts.
Data is safe – but sometimes it is unfair
And what about data protection? The telematics data collected is subject to strict data protection regulations. Insurers are only allowed to use them for a specific purpose and are not allowed to pass them on to third parties such as the police. Even in the event of damage, the insurance company is not allowed to use the data, for example to clarify questions of guilt.
However, some users criticize that the data is not always conclusive. The systems often do not record external factors that can influence driving behavior. For example, poor weather conditions or road conditions may force driving that may not be optimal for telematics scoring. Situations in which the driver avoids other traffic violations or even accidents by braking sharply could also be viewed negatively.
Novice drivers benefit the most
Telematics tariffs can be quite interesting for certain users. New drivers, who often pay higher insurance premiums, can benefit from significant discounts by driving carefully. Occasional drivers who rarely use their car or who mainly travel at times when there is little traffic can also benefit from the bonus, as these aspects are rewarded.
