Warning, this post may sound a bit like an advertisement.
Last week I got invited to find out a new product from Tower insurance that’s launching today that they hope will not only lower car insurance costs but also help make driving safer. In a nutshell the product is a smartphone app that measures driving behaviour using GPS and the sensors in the phone. From that it works out if you’re good driver or not and if you are, can give you discounts off your car insurance of up to 20%.
For the first time in New Zealand, safe drivers can benefit from lower insurance premiums based on their individual driving performance – thanks to an innovative free smartphone app offered by TOWER.
‘SmartDriver’ monitors and assesses an individual’s driving behaviour based on 250 kilometres of travel. Drivers who score well can then gain a discount on motor premiums of up to 20 per cent.
TOWER Chief Executive Officer David Hancock says TOWER’s strategy of innovating for the benefit of its customers is evidenced by the launch of SmartDriver. TOWER is always looking for ways to improve its risk profile, while lowering costs and providing enhanced value for customers.
“The insurance industry does not have a reputation for innovation, but TOWER is committed to delivering relevant products and better value to customers to help them protect the things they care about. This app is the first of its kind to be launched in Australasia.
“We’re really excited about SmartDriver’s potential to help customers in two ways – saving safe drivers money on premiums and encouraging safer driving for all New Zealanders.”
It’s all part of a move towards risk based pricing where those that present less risk pay less.
TOWER General Manager – Customer Proposition Mark Savage says the app means motor vehicle insurance premiums can now be determined using an individual’s driving behaviour, rather than solely relying on averaged claims risk and demographic data such as age and location.
“This kind of user-based-insurance – or UBI – has the potential to dramatically change the motor insurance market. TOWER has been monitoring the overseas experience for some time and we felt as a nation of drivers it made perfect sense to introduce it here.
“UBI provides fairer pricing to customers based on their driving, not just that of the population at large. And there is the huge advantage of making those using the app more conscious of their behaviour on the road.”
Mr Savage says telematics, the technology behind UBI, enables driving data to be gathered and transmitted directly from a vehicle on the road to the insurer. The insurer can monitor, analyse, score and then adjust premiums accordingly.
“By collecting basic driving information such as trip duration, distance travelled, location, braking and acceleration, we can build an understanding of driving behaviour and individual risk and adjust premiums accordingly. The app also allows customers to see their score versus the average score calculated from all the SmartDriver users who have completed 250 kilometres using the app.”
Tower have said that this is just a first step on the road to greater risk based pricing and they said giving discounts for those that have a car but who might be using PT, walking or cycling during the week might be considered in the future. I certainly hope it’s something that happens.
While the insurance aspect is obviously the key point of the app, it’s the potential impacts on driver safety that interest me the most. Tower said that amongst staff who helped trial the app, they found driving behaviour improved the more they used it through a combination of driving at slower speeds as well as smoother accelerating and braking. One of the key ways Tower have managed to achieve this is through the gameification in the app that gives points for better driving, achievements and leaderboards. That means that even if someone does the same trip every day there can be an incentive to constantly improve. I’ve been trialling the app and certainly noticed myself trying harder to be a better driver.
I also think there are some potentially interesting implications from this kind of technology. For example as the app keeps a record including a map of the trip taken, parents concerned about their kids driving (if they’re driving at all ;-)) could require them to use the app and show them the results. Of course if that were to happen it would probably just push even more young people to simply not bother getting a licence, using other modes to get around.
So here are some images of what the app looks like.
Opening the app you simply push start for it to start recording your journey and stop again to end it. Only journeys of more than 2km count towards getting a score.
At the end of each valid trip you get marked. Also notice the gameification elements (most of mine are like the one on the left)
Delving into a trip gives more details. As you can see I went to Warkworth on Friday afternoon. Despite moderate traffic it flowed smoothly except for one part around Schedewys Hill where I got marked down for braking due to a truck crawling up the hill (fixing that part of the route is one of the few things that need doing to the P2W route). Note these aren’t the same trips as the images above.
And here are the gameification elements which comprise of leaderboards and achievements. I would love to see something similar for HOP card users to encourage more PT trips. You have to register through the app to get these results and the official score after completion of 250km but it isn’t required to monitor individual trips.
The app generally seems to work well but there are a few improvements I’d like to see e.g while the app is running it prevents the screen from turning off which is a pain, on Android the back button seems buggy and often backs out of the app rather than going back to the previous screen. It would also be great for them to tie in the app to a mapping app and surely it would be worthwhile measuring if someone is using a phone at the same time as driving.
Overall I think this is a good move by tower and the use of technology to improve driver safety is something I definitely support, a view obviously shared by Ernst Zollner who is also the NZTA’s new regional director for Auckland and Northland/
Ernst Zӧllner, Road Safety Director at the NZ Transport Agency, says any technology that has the potential to contribute to making New Zealand roads safer for users is positive.
“Creating a safe road system depends on safer vehicles, users, roads and roadsides, and safer speeds. It’s really good to see a private insurer sharing responsibility for improving road safety by using technology and incentivising smart choices. This is consistent with Safer Journeys, the Government’s road safety strategy to 2020.”