UBI device could save drivers money

by | Mar 28, 2014 | Biz/Tech

Marlon Gomez
Biz/Tech Reporter

Humber students and Ontario residents could save money on their car insurance by installing new usage-based insurance (UBI) technology on to their vehicles.

Ontario insurance companies are giving their clients the chance to lower their insurance premiums based on their driving patterns.

The program is meant to encourage safe driving habits which can lead to discounts on people’s car insurance.

“It’s an innovative program that not only allows your premiums to reflect your personal driving behaviour, but also provides you with reports you can use to become a safer driver,” said Kathy Bardswick, president and CEO of The Co-operators in a media release.

The release explains that the information collected as part of the program will only be used to reward safe drivers and will not results in premium increases.

To participate in these programs people simply need to plug in a small wireless device into their vehicle that allows insurance companies to track driving behaviours.

There is not an extra cost for the device itself. That cost is calculated into the monthly or yearly payments.

UBI technology is meant to provide data about how and where people drive, said Christopher Dell, the Director of Product Management at Intelligent Mechatronic Systems (IMS).

“It has an accelerometer, similar to what you have in your smartphone. There is a GPS that tracks the where and how you’re driving in the device that then sends up through a cellular connection to our servers,” he said.

“The servers then interpret the data and send it to the insurance company. The insurance company then figures out a score that relates to an insurance discount,” said Dell.

This Waterloo based company makes the telematic technology for The Co-operators who will be launching their program in April. The program will be called “En route Auto Program.”

Desjardins Insurance launched their UBI program last May in both Ontario and Quebec called “Ajusto.”

The Canadian Automobile Association (CAA) announced last year they will also be investing in telematics technology and services.

“We plan on launching our insurance-based technology during spring time,” said Tony Tsai, the Communication Manager for CAA.

Intact Insurance has also been approved by the Financial Services Commission of Ontario to launch UBI services in the near future.

The factors used to evaluate driving patterns include time of day that a person is driving, total distance driven, sudden acceleration and sudden braking. All four factors are tracked by the device.

Upon signing up for the program with Desjardins, The Co-operators, and CAA people will receive an initial five per cent discount.

“Those four factors get used by us to calculate whether your discount will be larger than the five per cent that you get initially,” said Leonard Sharman, the media relations senior advisor for The Co-operators.

For Humber students who commute to campus from all over the GTA, this could be a great way to help cut down costly driving expenses.

“I pay $209 a month. I actually pay more because I live right by the intersection of to highway five and highway six,” said Jennifer Taugher, a 23 year old Humber Student in the Funeral Services program who has a clean driving record

“So when you get off the 403 at highway 6, going towards Guelph, that intersection is one of the heaviest traffic accident areas. And I fall in that bracket,” she said.

The Financial Services Commission of Ontario only allows insurance companies to revaluate people’s rate on a yearly basis.

However, information can be looked at much sooner than that. The Co-operators and IMS are launching a portal April 2 for clients to look at all of the information being tracked.

Desjardins also has an online dashboard with their existing program that gives clients 24/7 access.

Drivers can receive up to a 25 per cent discount on their premium, said Leonard Sharman.

“So next time your policy comes up for renewal, we look at your data and recalculate your discount,” said Sharman.

The co-operators will also allow people to view their information through their smartphones, said Sharman.

The Co-operators portal will include a tab that shows people an overall carbon footprint of their vehicle. It will calculate this based on fuel consumption, idling time, and how quickly they accelerate, said Sharman.

The year the car was made can determine whether people can sign up for these programs. For Desjardins’s UBI program, the car must be from 1996 an up. For the Co-operators any vehicles made from 1997 and up are considered eligible.