Leveraging technology to calculate insurance risk, improve the bottom line

This is the second of a two-part series that looks at commercial truck insurance and how carriers can influence their insurability and affect their rates. Part 1, “Rise in truck crashes, large payouts, expected to boost insurance renewal rates this year,” can be found here. 

While some decry mandated electronic tracking as counter-productive, others like Doug Schrier, vice-president of product and innovation at Transflo, believe that ELDs can improve a fleet’s bottom line in the long run.

If so equipped, ELDs can go beyond simply logging driver hours to keeping track of driving habits including speeding, hard braking, hard cornering, rapid acceleration and improper lane changes.

“We always look at safety. Safety first,” Schrier said. “What are the things they’re doing with risk reduction especially with ELDs? There could be a whole bunch of events that will let a fleet see abnormalities within their drivers’ behaviors. Which one of their drivers are the most at risk? Or having the most number of near misses? That’s a big piece that I think a lot of fleets may be missing.”

Schrier said insurance companies are increasingly turning towards technology to help with more thorough risk assessments.

“They’re using the data to determine the risk of that fleet over another and if you’re deemed to be a riskier fleet, you’re ultimately going to pay more for your insurance than if you’re deemed to be a less riskier fleet,” Schrier said. “We have also seen some companies in the insurance space play a much more active role by strongly encouraging that they have a certain kind of ELD that provides them the data that’s needed. They’re encouraging fleets to proactively interface with their drivers that are on the riskier side of the fleet, kind of driving toward camera solutions within the cab of the truck. Our telematics system, one thing that it does, because of the sensitivity of it, is that a truck can be in an accident and a forward-facing camera in front of you does a lot in mitigating that risk.”

Tommy Ruke, founder of the Motor Carrier Insurance Education Foundation, said fleets would be wise to invest in camera event recorders.