The technological advances of today can be seen in every aspect of our lives. From cell phones, which are as good as laptops, to medical programs that can connect every location, allowing you the ability to check on the history of one patient. The automotive insurance industry is moving into the future by using the IOT to connect directly with their consumers. To be more precise, the insurers are keeping track of your vehicle as you drive, automatically adjusting your premiums by judging your driving habits.

To understand how this can be possible you need to know what the IOT is. The Internet of things (IOT) is, according to Wikipedia, a group of sensors, software, and other technological devices that connect and exchange data with other systems through the use of the internet, or other communication networks. This may still seem like it is complicated. If you step back and take a few seconds to consider what it means to you it will become clearer. Especially after you finish this article and try it out for yourself.

Onboard Sensors

The best way for an insurer to judge how well you drive would be for the agent to sit in the vehicle with you. This is obviously not very plausible when you consider how many people the agent insurers, and from all the various locations that consumers live in.

So how can the car insurance industry get around this complication without hiring more insurance agents?

Onboard sensors fill the need, at a much more cost-effective level. These sensors come in different forms. Some of them are sent out to you so you can plug it into your car. Others are offered to you through applications that can be installed on your smart phone.

Either way, the sensors allow the programs at the insurers main computer clusters to collect information about your specific driving habits. Braking, accelerating, speed, attention to driving, and other details compiled through your sensor, and the surrounding areas.

Premiums Based on Data

The data collected by the sensors will be analyzed by the main programs and a risk assessment number will be given to you, based on all your driving habits. This allows for the premium charged to be customized for every driver. It will also create a nation of better drivers that are hoping to lower their insurance premiums.

The current way of accessing risk is through a set of formulas that are derived at by an agent punching in your answers through their program. The premium that it produces will be within a set perimeter that groups people together into one single premium cost. This old way does not allow for your specific driving habits and can cost you more than it should be.

Beyond Premium Costs

Lowering your premium costs is not the only benefit of IOT in the industry. All the data that is collected on you would be wasted if it were not used in a continuous manner. There will be a time when you need the information to be used during an accident, or if your car is stolen and taken for a joy ride.

The data can be used to avoid the conflicting stories given by witnesses, and the people involved. The police will be able to access the information, during their investigation, and come to an educated decision based on unbiased information. This will help speed up the time spent at the accident site and will decrease the time that it will take for the insurance company to settle. From there, your vehicle can quickly go into the shop for repairs, or to the junkyard so you can get it replaced.

Final Thoughts

Sensors that allow an insurance agency to monitor your every move, while driving, may seem a little strange to you at first. It is the way of the future, though, that will allow personalized policies to be given out. Discounts will be handed to those that deserve it. Accidents will no longer be a centered around the accounts given by upset people at the accident sight.

Using the IOT to connect the insurers with the insured is the way of the future. Jump onto the technological wave and ride it out to the end.

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