What Is Telematics?
Telematics uses new technology to keep track of everything from a car’s status to the driving habits of the operator.
Written by Holden Easterbrook
Reviewed by Kathleen Flear
Table of Contents
- What exactly is telematics?
- How do telematics systems work?
- Telematics and business
- Telematics and you
- How to find affordable car insurance
Load full table of contents
Telematics is a field that uses telecommunication technology to help computers gather data for application in real-world situations. In terms of cars, telematics devices allow for real-time updates on location, vehicle status, and even driving habits like speeding.
Finding the quickest routes, cutting down on fuel consumption, even flagging risky driving patterns—telematics is used by transportation-related companies to gather information about their fleets in order to streamline and optimize processes. However, you don’t have to be a business owner to find use in this cutting-edge field.
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What exactly is telematics?
In broad terms, telematics is a combination of two fields—telecommunication and informatics:
- Telecommunications focuses on how information is exchanged using technology.
- Informatics focuses on how computers source and process data while managing real-world systems.
Therefore, telematics is a field that uses communication technology to help computers gather data and apply what they learn to real-time situations.
To give you an example of telematics at work, imagine that you own a fleet of delivery vehicles. Without telematics, you have to rely on your drivers to identify problems in their vehicles, pick the most optimal delivery route, and
drive safely
. While this can work just fine, not everyone is as reliable as could be hoped and some problems will inevitably go unnoticed or unreported.By implementing a telematics system in your fleet, you can have access to real-time information about all these aspects of the vehicle, the job, and more. This will allow you to get more use out of your vehicles by staying on top of maintenance issues, cutting down on delivery times, and identifying drivers that have unsafe habits behind the wheel.
How do telematics systems work?
The telematics system installed in a car is a small device also known as a black box. It plugs into the vehicle’s OBD-II or CAN-BUS to gather engine data, GPS location, and everything else from aggressive braking to excessive idling times.
As it collects data from the vehicle, it uses a SIM card and modem to access nearby cellular towers. From there, the information is sent to secure servers that will format the information they receive for easy reading on a webpage or app. This way, companies can see who tends to speed, which routes are the quickest, and if any of the fleet vehicles need repairs.
How do you install telematics systems?
Many major car manufacturers have already begun installing telematics systems in their fleet vehicles. However, you can easily acquire aftermarket telematics devices and install them yourself—all you need is access to the OBD-II or CAN-BUS of the car in question.
The range of information you’ll receive from a telematics device will depend entirely on how much you’re willing to invest in the system. The cheaper systems will only report a vehicle’s GPS location, while the more costly systems will do everything mentioned so far and more.
Telematics and business
Telematics devices are a great way to streamline your business and cut down on unnecessary expenses. Specifically, you’ll see improvements in these areas so long as you invest in a telematics device that can collect the data:
- Efficiency—vehicle tracking, route optimization, geofencing
- Fleet management—idling habits, engine diagnostics, fuel consumption
- Safety—driving habits, weather alerts, seat belt usage
- Compliance—inspection reports, delivery times, driver logs
While it may seem like a big expense to outfit an entire fleet with telematics devices, many companies see a return on their investment within the first year. You also need to take into consideration the savings you’ll see by cutting down on fuel costs, drive times, and car accident costs.
Telematics and you
Despite what it may seem, you don’t need to own a business to make use of telematics. Many major car insurance providers offer substantial discounts for drivers willing to install one of these devices in their vehicles. By doing so, your insurance company can track risky driving behavior and reward you for safe driving habits.
Additionally, installing one of these devices in your car will give you an extra layer of security. Not only will you get information about problems with your car’s engine you might not have noticed, but the tracking data reported by the telematics device will help you get your car back quickly if it’s been
stolen
.MORE: How to get car insurance discounts
How to find affordable car insurance
Telematics devices are only one way to save money on your monthly car insurance payments. You can save just as much—or more—by shopping around for better-priced insurance using
Jerry
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If that’s not enough to convince you, what about this: Jerry will help cancel your old insurance policy for you, so you can start saving money as soon as possible. Along with that, you’ll also receive new insurance quotes whenever it’s time to renew your policy.
There’s never been a better time to ditch your overpriced car insurance for the coverage you want and the savings you deserve. Download the Jerry app today and start saving hundreds!
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Do I need a smart car to use telematics?
No. While many fleet vehicles are being made with pre-installed telematics devices, you can always purchase an aftermarket device and install it yourself.
Why does my insurance company use telematics?
Insurance companies use telematics devices to track the driving habits of their customers. With this information, they can reward safe drivers with additional insurance discounts and warn others of habits that are putting them at unnecessary risk.
4.7
