UBI and telematics can make motorists drive better study finds

Published: July 11, 2017

Updated: July 24, 2018

Author: Luke Jones



Usage-based insurance (UBI) has been elevated by some as an answer to the industry’s problems. It can help reduce premiums and through integration of telematics devices, also bring down collisions. Researchers at the University of British Columbia (UBC) have conducted a study that show the latter claim may well be true.

The team studied usage-based auto insurance and discovered the use of telematics to monitor driving behaviour will help customers drive better. UBI allows drivers to pay for what they use. With telematics, a connected device will monitor driving habit such as speed and where the vehicle is parked.

If a driver operates well and meets all criteria, they will be able to get an improved premium. In other words, good drivers will pay less for their auto insurance and bad drivers will be exposed. Canada has been generally slow to adopt telematics, but in some nations (Italy and the UK are prime examples), the model is working.

Indeed, in the UK, the use of telematics has meant drivers under 21-years have seen their premiums remain at normal levels while all other demographics are paying record amounts for coverage.

The researchers from UBC studied 30,000 drivers and the data suggested UBI could make drivers better. The team also said it expects UBI to have been adopted by 142 million people by 2023. Speaking with CBC, Charles Weinberg, lead author on the study, explained the key findings:

“What we found is that women, as compared to men, seem to improve their behaviour more, and younger people as compared to older people, also tend to improve their behaviour more,” Weinberg said.

Young people are less likely to be set in their ways, their habits have not yet properly formed. This means they are more responsive to telematics and more open to change their driving behaviour to adjust.

“If your behavior gets better, it gets better over usually the first six to eight weeks and then pretty much stabilizes, so we think that your new driving behaviour then becomes your ingrained or habitual driving behaviour and that’s how you drive afterwards,” commented Weinberg.