How A Telematics Solution Can Help Reduce Insurance Premiums

As trucking technology continually evolves, so does transportation legislation. In an effort to “modernize truck safety standards”, Senator Cory Booker (D-NJ) has introduced a bill aimed at saving the lives of truck drivers. His proposed Truck Safety Act (S. 1739) would require:

• Collision avoidance systems such as forward collision warnings and lane departure warnings for commercial motor vehicles
• Speed limiting devices that automatically prevent speeding for all commercial vehicles
• Driver compensation per hours worked, instead of the current industry standard of per mile compensation which incentivizes overwork
• A study on the effects of excessive commuting, including whether long commutes for drivers to and from work contribute to dangerous exhaustion on the job
• An increase of minimum insurance from $750,000 to $1.5 million per truck in order to keep up with inflation. The Secretary of Transportation would also have the authority to raise the insurance minimum as needed.

Truckers have a tough job. They work long hours to deliver goods that the public depends on, and maintain the U.S. economy moving at a strong pace. But many times, to make deliveries in a timely manner, the safety and security of drivers are put on the line.

The technology proposed in Senator Booker’s legislation—collision avoidance systems and speed limiting devices—are each expected to increase safety on the road by sending automatic alerts and preventing drivers from exceeding design limits on tires.

Furthermore, changing the standard to hourly payment for drivers would take away the financial incentives that lead many drivers into unsafe and exhausting behaviors. Driver fatigue can be further exacerbated by long commute time. The results of a study on excessive commuting as proposed by Senator Booker could provide key insight into additional driving truckers are performing before and after they clock in for a day’s work.  

Most importantly, increasing the insurance minimum should allow truckers to be more responsible users of the road. Since the insurance minimum has not increased in a generation, the amount of coverage each driver carries has effectively shrunk. The Truck Safety Act could correct the problem, adjusting to inflation and bring the minimum back up to where it should be.

With a higher insurance minimum, the premium will naturally increase as well. And for a carrier, that increase can strain a budget. But there are ways to soften the blow.

Carriers that incorporate telematics services, including Teletrac, can see dramatic improvement in safety, reducing liability risk and costly premiums. With management tools that provide visibility over an entire fleet of vehicles, monitoring driver safety and unauthorized vehicle use is made easy.

Teletrac’s Safety Analytics Event Viewer automatically records vehicle activity enabling carriers to dispute claims and win. This feature in Teletrac’s software has been recognized by the nation’s top insurance carriers as a risk management system, helping carriers prevent unnecessary costs, accidents and vehicle abuse.

One particular partner, Citroën, released the first consumer vehicle with free, standard fit telematics-based insurance solution to help their drivers create safe driving habits, and in turn gain improved insurance rates. Teletrac’s solution works across industries—small or large.

While in its infancy, we’ll have to wait and see the outcome of the Truck Safety Act. But its intentions seems positive. By incorporating the latest technology to help reduce accidents, road violations and possible theft, insurance premiums are lower and carriers can experience an overall larger discount with their insurance plan, and safety across their entire fleet.