May 25, 2021

How embedded telematics is revolutionizing auto insurance

Amber Livingston

Marketing Manager

Embedded vehicle telematics is enabling a new generation of fairer, more accurate, and more affordable insurance products. Join our upcoming webinar with Smartcar CEO Sahas Katta and True Mileage CEO Ryan Morrison to learn more.

Embedded telematics is driving progress in many industries, including auto insurance. But what is embedded telematics, and how do auto insurers benefit from it?

Embedded telematics

Embedded telematics is a technology that allows connected cars to communicate with other devices via the internet. The purpose of embedded telematics is to make vehicle telemetry—i.e., the data that a car generates—available without the need for an aftermarket hardware device. Examples of vehicle telemetry are a car’s location, odometer reading, fuel tank level or EV battery level, tire pressure, and engine oil life.

Vehicle owners can access their vehicle’s telemetry with a mobile app that their car brand offers. But this is not the only benefit that embedded telematics provides. Many industries—from car sharing to energy—use embedded telematics to improve their products and services with functionalities like digital key sharing and smart EV charging.

Driving change for auto insurance

Like in other industries, embedded telematics is enabling rapid change in the auto insurance industry. For decades, insurers had to account for inaccurate or missing mileage information and replace mileage with related factors in their rating algorithms.

Today, embedded telematics allow insurers to easily verify their policyholders’ mileage and price policies more accurately and fairly, all without hardware. New insurance models like pay-per-mile insurance and usage-based insurance (UBI) are on the rise and redefine what car insurance looks like in the 21st century.

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