Telematics combines the words ‘telecommunications’ and ‘information’ and was first used in a report to the French government on the computerisation of society. Simply put, telematics describes the wireless transmission and storage of information from remote sources such as vehicles and machinery. Telematics technology serves a multitude of industries, particularly within the transport and insurance sectors.
So how does telematics work?
A telematics device, sometimes referred to as a ‘black box’ or ‘telematics box’, is installed into a vehicle, increasingly by the user as devices become smaller and simpler to fit. Each device contains three main components: a GPS antenna, an accelerometer and a SIM card. The GPS system detects where you or are positioned in the world, which type of road you are travelling on (e.g. country lanes or motorways), when the vehicle is being used, and also the speed you are travelling. The accelerometer detects whether your vehicle is involved in an impact but intelligent algorithms are also able to detect events like heavy braking, harsh cornering and hard acceleration. In addition, because the device is connected to the CANbus (effectively the vehicle’s central nervous system), any battery health issues or diagnostic trouble codes can also be identified by the black box.
This information is then transmitted via the inbuilt SIM card to central computers where data from various devices is collected and analysed. In the case of Trakm8, 3 billion miles of data are collected each year. This data is then analysed by our team of Big Data scientists in order to continually develop and improve the accuracy of the information being reported. For example, Trakm8’s algorithms are able to differentiate between an impact caused by a collision to those caused by driving over a cattle grid or rumble strip.
Who uses telematics and why?
Many businesses with multiple vehicles use telematics for vehicle tracking. This enables them to view the location of their entire fleet all in one place. This is useful, for example, when a company needs to deploy, say, an emergency plumber to a specific location. With live vehicle tracking, a fleet manager can identify who is closest to the job in order to provide a quick and efficient service for their customer.
In addition to GPS tracking, telematics is a great way for businesses to reduce their fuel expenditure. By monitoring and encouraging change in behaviours such as speeding, harsh acceleration and heavy braking, businesses can save up to 15% on their fuel bill. The AA, for example, saved £1 million in the first year of using Trakm8’s driver behaviour telematics product.
Telematics is becoming increasingly popular amongst drivers as a tool to reduce their insurance premiums. Some insurers will reduce annual premiums by up to 30% when drivers choose to share their data with them. By monitoring time of use, speeding and other driver behaviour parameters, insurers are easily able to identify which policyholders pose the most risk and the drivers most likely to be involved in an accident.
Hauliers use telematics in order to ensure that their drivers are compliant with DVSA regulations on driver hours and driver breaks. Telematics can be connected to digital tachographs in order for fleet managers to identify breaks, hours and speeding incidents, ensuring that operators remain legal within the requirements outlined by the European Union.
Operators of plant and machinery benefit from telematics by means of predictive maintenance and monitoring unauthorised use. Notifications can be flagged up to plant managers before a machine loses power in order for them to order the necessary parts to carry out repairs before their business operations are affected. Telematics also reminds plant owners when specific machines are due to be serviced.
What does the future hold for telematics?
According to the RAC, telematics uptake among businesses of all sizes increased by 27% last year. As the available financial benefits become better publicised, it is likely that this trend will continue for many years to come. Businesses will begin to automate more processes in the coming years and features such as automated P11d mileage forms will save huge amounts of admin time, therefore, telematics seems like a good way to improve productivity.
Similarly, research from BIBA last year suggested telematics-based motor insurance policies had risen by 40% between December 15 and the year previous. Again, as insurance premiums continue to rise, the wider public will begin to see telematics as a real opportunity to save money on their annual premiums. Traditionally, it has been younger drivers have seen the benefit of sharing their driver data with their insurance company but it is likely that drivers of all ages will begin to install black boxes into their vehicles in order to make further savings.
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