What is telematics insurance?
You may have heard it called usage-based, pay-as-you-drive, or even pay-per-mile insurance. Whatever the name, the idea is simple: your premium is based on how well and how often you drive.
Instead of paying a standard rate based on age, ZIP code, or vehicle type, telematics provides insurers with a more personalized picture, allowing your good driving habits to work in your favor.
How does telematics work?
When you enroll in a telematics program, your driving is tracked through one of the following:
- A small device that plugs into your car’s diagnostic port
- A smartphone app
- A Bluetooth-enabled beacon that pairs with your phone
Each program is a little different, but most of them track factors like:
- How far you drive
- When you’re on the road
- Sudden braking or rapid acceleration
- Hard turns or aggressive cornering
- Your speed
- Whether or not you use your phone while driving
Will Telematics Save Me Money?
Whether you save money depends on your driving style.
To earn a discount, you’ll generally need to drive less than average and demonstrate safe driving behaviors. That means avoiding hard stops, late-night drives, and fast takeoffs. If you already drive cautiously and stay off the road during peak risk hours, you’re more likely to see savings.
If you drive more aggressively or spend a lot of time behind the wheel each day, you might not benefit and could even end up paying more than you do with a traditional policy.
Not sure telematics fits your needs? You have other options.
If telematics doesn’t sound like a match for your lifestyle, there are still plenty of other ways to save on your premium. Ask your insurance advisor about discounts for things like:
- Multi-car policies
- Good student status
- Driving a newer vehicle
- Military service
Telematics Pros & Cons
Pros
- Rewards good driving behavior
- Helps offset high premiums due to age or location
- Encourages safer habits with real-time feedback
Cons
- You’ll be sharing detailed driving data with your insurer
- Some programs penalize nighttime driving or long commutes
- Not all programs are created equal—features vary by insurer
We’ll help you explore your telematics options!
We work with multiple insurance carriers that offer telematics programs. Every company’s program is unique and takes into account factors such as your location and driving habits. At Leavitt Group Texas Select, we’ll help you find the telematics program that fits you the best. Reach out today!
Click here to learn more about telematics.
Have questions? Contact:
