By 2025, it is expected that telematics integration in new cars sold globally could reach 88%. North America will continue to be the leaders in telematics adoption, especially in the commercial segment, but the market is expected to triple in size all over the world by 2020.
Which telematics companies had the most revenue in 2015?
Benefits of telematics
Last week, we made an infographic showing the benefits of remote diagnostics in the automotive industry, and highlighted its importance in improving vehicle improvements and road safety. Telematics can help those behind the wheel significantly improve their driving skills by identifying risky types of driving like sharp acceleration and braking, speeding and sharp cornering, and then providing advice to drivers on how to correct these tendencies.
Telematics also monitors the variables you can’t control, such as wind speed, the speed of other vehicles, and moisture on the road due to oil spills. Wide angle cameras, automobile radars and emergency call services are also provided to keep a driver safe on the road. All of these features can be combined to create the ultimate highway management system.
Improving Road Safety
According to the World Health Organization, an estimated 1.25 million people worldwide die in traffic accidents annually. Another 20-50 million suffer nonfatal injuries. Without any immediate action to address these issues, traffic accidents could become the seventh leading cause of death worldwide (it’s currently ninth) by 2030.
Which Countries Have the Most Road Fatalities?
Graph created by Technavio, data retrieved from WHO
Improvement of road safety is desperately needed in regions like Southeast Asia and especially Africa. Both regions represent enormous growth opportunities for telematics companies, telematics insurance companies in particular. Telematics insurance provides accurate data on individual drivers, in addition to encouraging safer driving.
The past few years have seen a large push to make telematics insurance the norm in South Africa, as the country ranks in the bottom half of the world for road fatalities per 100,000 motor vehicles and per 100,000 inhabitants. Unfortunately, this trend has not caught on as much as the country and insurance companies had hoped, with telematics-based insurance representing only around 2.5% of the South African retail vehicle insurance market. Despite this lack of penetration, the future for the industry remains bright. As the technology gets better and cheaper, insurers expect its popularity to grow.
According to a recent global study on usage-based insurance by consultancy group Ptolemus, there will be 100 million telematics based insurance policies by 2020, a significant jump from the current figure of 12 million. Telematics as a foundation of the motor insurance industry will continue to grow as adoption rates grow and cars are increasingly manufactured with onboard diagnostic systems. This is a trend that stands to benefit consumers, insurers, and society as a whole.
