Fleet Telematics - Is this the silver bullet?

There has been a lot of hype around the use of telematics to manage fleet risks, but is this the silver bullet managers have been looking for?

Utilising telemetry data – whether this is from a traditional installed ‘black box’, (a device that plugs into the vehicle’s diagnostic port) or an app on a smartphone – will give a manager insights into how their employees are driving. 

Driver behaviours typically measured are harsh braking and acceleration, cornering and speeding (either a set threshold speed or, more usefully, the speed compared to the enforced speed limit). 

So with this wealth of data available, why are more customers not using telematics as a way to reduce their accident and claim rates? 

Probably the biggest obstacle preventing the wider adoption of telematics is the need for managers to do something with the data. The data generated gives managers an insight into who is at risk, based on their behaviours, but not why they are driving like this, so driver debriefs are required to understand the root cause(s). This is often the major barrier to adopting driver behaviour telematics, as either managers haven’t got the necessary experience to conduct the driver debriefs (and/or there is no appetite to train them to do so) or they haven’t got the time, or both! 

Without manager engagement, employees are unlikely to modify their driving in the medium to long term. There will be a ‘honeymoon period’ after the equipment is installed, but when employees see that nobody is talking to them about how they are driving, then they are likely to revert and continue driving how they have always done.

Cost is also seen as a barrier, but is this the real reason why organisations may have decided not to use telematics? 

Where it is used successfully, modified driving behaviours lead to significant fuel savings, with 5-10% reductions being easily achievable, and this is before the cost saving implications of any improvement in the accident and claim rates are taken into account. The fuel savings alone will give payback on the investment in months rather than years, and there are many customers already enjoying these.

So it is not the cost of the equipment that is the barrier but, instead, the realisation that to achieve these ongoing savings then managers have to be using the data and talking to their drivers, as this is the only way to ensure telematics will be effective in modifying driver behaviours. This may fall into the ‘too difficult to manage’ category for some employers. 

Driver behaviour telematics is not the silver bullet, but where it is used effectively, with ongoing management support and commitment, then it can be one of the most useful tools in the risk management toolbox for businesses.

For more information regarding the issues discussed in this article you can contact us on 0114 280 2830

Andy Price, Practice Leader – EMEA, Motor Fleet,
Zurich Risk Engineering