Usage Based Insurance, Powered by Telematics

What is Usage Based Insurance?

Usage Based Insurance, or UBI, is defined by the National Association of Insurance Commissioners as “a type of auto insurance that tracks mileage and driving behaviors”.  They further explain that the “basic idea of UBI is that a driver’s behavior is monitored directly while the person drives, allowing insurers to more closely align driving behaviors with premium rates.”

How UBI Works

Underwriters can now consider factors that formerly were not available.  Total miles driven, time of day, geographic location, and road type all speak to driving conditions and insurance liability.  Speed, rapid acceleration, hard braking, and hard cornering are behaviors known to directly impact accident risk.  Obviously actual automobile usage is a more accurate method to assess risk than the actuarial methods in use.  Actuarial methods aggregate accident risk based on age, gender, marital status, credit score, and driving history.  Consequently UBI is a much fairer way to assign risk and set insurance premiums.

In response, telematics vendors are developing more tools to evaluate at risk driving.  For example, the free Verisk Data Exchange add-in was recently introduced to the Geotab Marketplace.  It is a platform that allows both customers and their insurers to access the same smart analytics that impact insurance premiums.

Usage Based Insurance App

Telematics is the Key to UBI

Advanced telematics is what makes Usage Based Insurance possible.  Over the years, telematics providers and their partners have proven the value of telematics data.  The information at our fingertips identifies risky driving behaviors.  More important, we can use it to improve and correct them with driver training. In contrast, not acting on the information we have increases liability. But that is easily corrected as shown in the video below.  Clearly the benefits that make companies more efficient and competitive outweigh any concerns over increased liability. Usage Based Insurance rates are another potential cost savings to add to that return on investment.

Usage Based Insurance Drives Driver Improvement

Improving driver behavior based on telematics data is easy to automate.  Apps like Predictive Coach do all of the heavy lifting.  There are also traditional courses like the National Safety Council Defensive Driving Course.  A combination of ongoing and individually targeted training raises driver safety awareness and creates a culture of safety.  Doing that will more than pay for itself in the long run, not to mention reducing your company liability.  Proactive training increases the opportunity to reduce insurance premiums with new and innovative insurance plans like Usage Based Insurance.  Ultimately the incentive to improve driving behavior for lower insurance rates will drive the success of initiatives like Vision Zero, making the roads safer for us all.

What the Future Holds

In conclusion, Transport Topics recently stated “Rising insurance premiums are a perennial stress for many motor carriers, many of which are now installing telematics systems with the latest safety technologies to mitigate cost increases. This is a positive trend for the trucking industry, and more carriers should fully embrace these technologies as they soon will become necessary to operate a safe, efficient and, ultimately, more profitable trucking fleet.”

We agree and are here to help you get the technology in place, and use it to create positive change.
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How STEER Tech Can Save Time and Money

Guest Post submitted by Joshua Tohn, STEER Tech, LLC

Return on Investment – Automate Repetitive Tasks

Return on investment begins with innovation.  What are humans good at? Problem solving, communicating complex issues, critical analysis, and creativity. We hire people to do hard work efficiently. The better job they do, the greater the impact on the business. So why do personnel spend so much time doing mundane and repetitive tasks? Sure they can do them, but that’s not where employees are the most valuable.

Fleet management is always looking to optimize fleet operations without compromising the safety of the team or the equipment. Tasks like juggling vehicles in a parking lot or getting them refueled are important to any fleet, but are a waste of human talent. With that in mind, it raises the biggest question of them all: If it’s a waste to have humans do these mundane tasks, then who (or what) should do them?

Introducing STEER Tech

Whether we like it or not, automation is becoming a core aspect of our world, fleet operations. Factories are installing more and more robots if they aren’t already mostly automated. Companies are on a sprint to automate as many different tasks as possible.  Often little consideration is given the humans that are diminished by the new equipment. As this wave of automation sweeps over the world, we need to ask ourselves, what is our relationship to robots? Are they an attempt to replace us? Better yet, can we design autonomous equipment to be an extension of human talent?  Ideally, automation should increase the return on investment in our human resources.

STEER Tech has found and leveraged the middle ground between the use of automation and the retention of valuable employees. Robots shouldn’t be designed to replace humans, but support them. Many relatively simple tasks like cleaning, parking, and transporting vehicles are necessary to the operation of fleets.  At the same time, they are a waste of human talent. With the input of autonomous vehicles, fleet operators can focus on the critical work actually tied to the job.

Steer Logo

Autonomous Parking

STEER Tech creates autonomous parking kits that are retrofitted onto existing fleet vehicles.  The science is innovative, but the result is simple. When a vehicle using a STEER Kit arrives at a parking lot, the driver just gets out and goes right to work.  The vehicle safely navigates to an available spot and parks itself. The kit doesn’t impact the vehicle’s usability at all, it is just a couple of low profile sensors and a small computer that can be installed in less than a day.

Autonomous parking is useful for consumers, but the use cases expand dramatically when applied to fleet operations. A single operator can remotely move self-driving vehicles around a parking lot, send them to garages, have the vehicles meet drivers at the door, and report back a variety of diagnostics information, such as fuel levels and vehicle health.

STEER Kit
The STEER Kit is an extension of the employees, saving them the wasted time walking around parking lots, finding the right car with the right keys, reducing the risk of collisions and damage to the vehicles, and most importantly, turning every vehicle in a parking lot into the most vigilant and alert driver. With over 50,000 crashes in U.S. parking lots per year, having the safety net of an autonomous car will provide return on investment simply by avoiding accidental damage.

The Dollar Value of Efficiency

In the same way your GPS tracking system pays off big by helping you to reduce idle events and aggressive driving habits, savings are found when the cost of brief but frequent wasteful events add up over time.  It only takes a couple of minutes to park a car, right? How much does that really cost?

First, assume approximately 260 workdays in a year.  If one employee spends ten minutes retrieving the vehicle, and ten minutes parking the vehicle every day, you end up with 86 hours a year spent just parking and retrieving vehicles. Next, assume an 8-hour shift, that would add up to over 10 working days lost a year.  That could easily cost the company over $1,500 per employee per year depending on salary and benefits. How many more job sites could someone visit in 10 days? How many more deliveries can be made?  That is where we find substantial return on investment.

Finally take those 86 hours (or 10 working days) and multiply them by how many employees are parking and retrieving those fleet vehicles. 10 people = 860 hours. It’s easy to overlook how expensive the time spent parking cars is.  Ultimately spending what could be productive hours on parking is just money thrown away. Parking a car does nothing to generate the company revenue.  Certainly it doesn’t save money.  On the other hand, autonomous vehicles, applied in the right way, recoup the loss without putting employment opportunities in jeopardy.

STEER Tech vehicle

The Future of Fleet Management

The world is headed toward a future of near-universal automation. We need to ask ourselves: What will our relationship with automation be? With technology like the STEER Kit, the answer is a harmonious future. Tools like this are not a far-off Jetson’s style future and they are available now. Integrating them as powerful extensions of the employee contributes to making a company more successful.  Employees have more time to focus their skills and knowledge on the real work, supporting the team with every step.

The future of fleet management is one of automation.  Imagine a team member steps out of the office and the vehicle they need for the day is there waiting for them. One operator can summon and send the right vehicles to the right places when they are needed. Done safely, done right, and with no hassle or delay.

To learn more about this innovative technology, email Steer tech.

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Driver Feedback to Create Positive Change

Using Feedback to Create Positive Change is Nothing New

From our perspective, that is what fleet tracking is for.  Using feedback to create positive change in fleets and drivers is what we are all about.  Feedback from devices changes driving habits.  It has evolved from simple beeping when exceptions are triggered, to spoken coaching prompts using hardware, artificial intelligence, and integrated apps.  In the same way, using feedback from employees is a great way to create positive change in your organization.

Using Feedback to Create Positive Change

Feedback is Critical to Improving Performance

You can’t fix it if you don’t know what’s broken.  Just as your GPS tracking system tells you where the fleet needs attention, constructive driver feedback points out what areas in your business need attention.  In the old days, a suggestion box was enough.  In today’s environment that is just not enough.  With so many complex procedures and processes in place, employee feedback is critical.

Management that listens to what employees are saying continually improves how business gets done. As an example, we recently looked at our own order processing.  We noticed a checklist that we created for every order duplicated information that was already in our new order notification emails.  We did it just because that it how order processing had always been done.  Certainly the notification email in place of the checklist to initiate order processing will streamline the process and save us all time.

Encouraging Constructive Feedback

Ultimately, drivers need to feel that their feedback is wanted and welcomed.  Encouraging employee feedback based on specific goals is one way to get them to open up.  Another good way to start is to ask for suggestions.  Simple surveys or a form for employees to respond after a review can begin to create a culture where drivers feel their views and suggestions are valued.  Similarly incentives for the best suggestions often encourage a dialogue.

Once the feedback begins, don’t take criticism personally.  Without a doubt you need to know what things look like from the employee perspective to be an effective manager.  For that reason you must be willing to receive criticism with an open mind. As an example, employees may say they are being faulted for speeding events they can’t avoid and feel management is too hard on them for it.  They could be right.  You can’t legitimately fault an employee for speeding or for not completing all of his stops on a route that cannot be reasonably completed at the posted speed limit.

It may be time for your organization to consider a routing and scheduling application to better plan and optimize your routes.  With route optimization you can also save on fuel and maintenance while providing improved customer service.  Ask us about our free assessment tool that can analyze your current routes and project your return on investment.

Giving and Receiving Effective Feedback

Certainly we are not the experts on this subject, but there is a lot of good information to be found on the web.  We have shared a few of them below.

“9 Ways To Give Effective Employee Feedback”

15Five Blog is focused on giving feedback to employees, but the principals are the same whether the feedback is going uphill or downhill.

Receiving Constructive Feedback From Your Employees”

Recently published on Impraise blog.  It has a lot of good suggestions on how to encourage employees to open up and respond in a way that keeps the feedback coming.

“Feedback is Critical to Improving Performance”

The U.S. Office of Personnel Management (OPM) serves as the chief human resources agency and personnel policy manager for the Federal Government. They have also posted on the subject.

Roadrunner Freight Featured on American Trucker

Most interesting to our readers are probably the results achieved by Roadrunner Freight.  Roadrunner intentionally solicited and is making changes based on driver feedback in an effort to eliminate turnover and increase driver retention.  This prompted what they call a “major cultural overhaul”.  You can read all about it here on American Trucker.

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High Tech Solutions for COVID 19 Safety

High Tech Solutions

High Tech Solutions to Win

Recent high tech solutions we are seeing are proof positive that we are well on our way to overcoming the obstacles created by the COVID 19 crisis.  It’s high time to get us all back to work, and innovation is the American way.

 

High Tech Solutions from Ford

Ford Motor Company is at the top of that list with a system recently featured on Government Fleet.  This new software uses existing systems for a new purpose, to neutralize the virus in police vehicles.  It is available immediately on all 2013-19 Police Interceptor Utility vehicles.  The system uses heat generated from the vehicle’s powertrain and climate control systems.  It raises the temperature in the passenger compartment to over 133 degrees for 15 minutes, long enough to help disinfect the surfaces that are touched by officers and passengers.

 

High Tech Solutions for Law Enforcement

Predictive Analytics

Inspired by events following Hurricane Irma, USF has been working on a project to bring predictive analytics to health care staffing needs.  The idea is to create a high-tech tool to help provide nursing homes with a way to predict and plan for staffing.  Ultimately, this model could be applied to other industries when a crisis is looming.

 

High Tech Solutions in Retail

According to businessreport.com, Magnolia Bakery in NYC is encouraging patrons to pass through a UV chamber similar to the airlocks outside biohazard labs.  A 20 second UV exposure is thought to be lethal for viruses and bacteria, but safe for humans.

 

Partners for High Tech Solutions

Computerworld recently posted a list of high tech companies offering development assistance, products, and online forums to assist all kinds of businesses to adapt to new social distancing and operational protocols.  Help is available for everything from business solutions to adapt for a remote workforce, to virtual classes and meetings, to crowd sourcing to feed the homeless and hungry. Businesses, individuals like Bill Gates, and organizations like the USO are all finding and sharing ways to overcome the challenges presented by COVID 19.

 

All of this is evidence that the American spirit is strong and innovative.  We will more than survive.  We will thrive!

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Vision Zero and How Telematics Can Help You Get There

Vision Zero and Telematics

Contributed by Kim Thoman

In this segment we will discuss Vision Zero and how sophisticated and affordable telematics solutions can help you reach your goals. First it is important to understand what Vision Zero means and how it works.

Vision Zero is a strategy to eliminate all traffic fatalities and severe injuries, while increasing safe, healthy, equitable mobility for all. First implemented in Sweden in the 1990’s, Vision Zero has proved successful across Europe. It was officially introduced in North America 1995 and is quickly being adopted across many cities in the United States. Among these cities are Seattle, NYC, San Francisco, Washington D.C., Boston and many more. Even closer to home Orlando, Tampa and Hillsborough are implementing Vision Zero goals.

Where to Start

The question is what tools are needed analyze the data involved with traffic fatalities. Information that is important to study is traffic patterns, traffic light coordination and timing, occurrence of collisions and the ability to highlight hazardous intersections to name a few. NYC’s Department of Citywide Administrative Services (DCAS), for example, adopted telematics to encourage safe driver behavior in its very large municipal fleet. In an effort to make change DCAS uses collision reporting data to better understand the occurrence of collisions. This allows them to better modify safety training, evaluate roadway conditions and assess the efficiency of street improvements and projects for all road users. Another benefit of telematics for DCAS is the reduction of costly lawsuits and process that consume valuable resources.

Vision Zero Results

NYC’s Department of Transportation (DOT) also implemented the same telematics solution in the agency’s 35,000 fleet vehicles to analyze the speed within the fleet and the quality of pavement. “In NYC, telematics has contributed to a reduction in fatalities – two in 2018 compared to eight in 2014 as employees engage in safer driving behavior.”

We live in an era of “Big Data”. Telematics can optimize “smart transportation”. Aggregate data allows cities to closely monitor traffic flows, understand the effects of new projects and speed reduction programs as well as assess the efficiency of traffic signals, map air quality and highlight hazardous intersections. These are all tools to better manage the city’s transportation system as a whole.

Vision Zero

More Benefits With Less Effort

By combining air quality sensors with telematics solutions, city vehicles have the ability to measure air pollution without changing their regular routes, according to the Environmental Defense Fund (EDF). Air pollution data is collected by stationary air quality monitors placed miles apart. This has been proven not to be the best solution as studies have shown that air pollution levels can vary greatly from one block to another.

By installing mobile monitors on fleet vehicles could allow a city to cover more ground. “According to the report, a fleet in a small or medium North American city could map 50% or more of the city with 10 vehicles, and almost 80% of the city with 20 vehicles. In Washington, D.C., where only five stationary air pollution monitors are installed throughout the city, the top 20 public vehicles covered nearly 70% of the city in six months”.

The Future of Vision Zero and Telematics

“Vision Zero is not a slogan, not a tagline, not even just a program. It is a fundamentally different way to approach traffic safety.” That being said, implementing a successfully proven telematics solution is an invaluable tool to help cities across North American reach these powerful safety goals.

Contact Fleetistics today for a consultation.

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