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How Car Insurance Companies Can Help Reduce Distracted Driving

Millions of people in our country can’t stop themselves from talking, texting, and even FaceTiming when they’re driving — according to a distracted driving report by Zendrive.

And it’s not that car insurance companies aren’t aware of this phone addiction among drivers...

Cellphone addiction among drivers

Everyone is tracking your phone usage pattern while driving. At times, insurers can even access your phone records to check if you were using it while driving.

A 2019 Distracted Driving poll conducted by the insurance company, Travelers, found that around 77 percent of drivers use their phones while driving to make or pick up calls, and 44 percent e-mail or text behind the wheel.

Auto insurance companies are now using technology to track driving behavior mainly to price policies more accurately. In fact, most companies offer discounts when motorists agree to participate in their driver monitoring program.

Because auto insurance providers have data on how distractions are a part of driving these days, they can help in discouraging this behavior among motorists.

In fact, simply creating awareness about how dangerous distracted driving is can go a long way. According to Cambridge Mobile, distraction level drops by 35 percent in motorists who regularly track their driving data.

How does distracted driving affect insurance companies?

If you’re caught texting while driving, you will most probably get a ticket depending on the state you live in. Most states prohibit texting, while many states ban the use of cellphones.

Additionally, if you cause an accident while using your phone, there’s a high probability your insurance provider will raise your rates.

As motorists, we might think that distracted driving benefits the pockets of auto insurance providers.

But, that’s not the reality always.

At times, the insurance losses from accident claims surpass the premiums these providers earn. In 2016, State Farm incurred claims and loss adjustment expenses of $35.8 billion which led to an overall loss of $7 billion in the auto insurance segment.

Obviously, these claim losses cover all types of accidents. But since distracted driving accidents are on a rise and leading to more claims, you can imagine how much the claim losses are mounting up for auto insurance providers.

As per data from the National Highway Safety Administration (NHTSA), distracted driving crashes accounted for almost 9 percent of the fatal accidents by the end of 2017.

With this rising trend towards fatal crashes from distracted driving, auto insurance companies also have to deal with huge losses.

Another important thing to note here is the reliability of data regarding the cause of an accident. In most situations, motorists lie about the reason that caused an accident.

What company would accept their claim if they were trying to text when the accident happened?

As per Zendrive, almost 69 million motorists use their smartphones while driving each day. This number is much higher than the official numbers with any state or federal agency.

But if motorists are careful and keep their eyes on the road, they can reduce losses for auto insurance companies.

Does distracted driving increase insurance premiums?

One of the common solutions for most insurance providers is to raise your insurance premiums when they notice an increase in distracted driving accidents.

And there have been many incidents of steep premium increases because of a rise in distracted driving.

According to the National Association of Insurance Commissioners, auto insurance premiums have risen by 16 percent since 2011.

How can auto insurance companies fight distracted driving?

To start with, it would really help if auto insurance companies take a more concentrated approach to reduce the instances of distracted driving by raising awareness about it.

Thankfully, many auto insurance providers are doing their bit by creating graphics, sharing distracted driving statistics, and making videos to communicate the importance of being attentive while driving.

Let’s read about additional initiatives insurance providers can take.

However, communicating about the dangers of distracted driving as well as clearly indicating how it’s raising their rates might make an impact.

According to the ConnectedTravel platform, early trials reaped encouraging results. Around 4 out of the 5 participants checked their driving stats daily, and phone use dropped by 40 percent.

Travelers has a section on their website with quizzes, conversation starters, and videos to make people aware of the consequences of their actions. Their campaign focuses on changing the awareness level of people.

They also have an interesting video series — it talks about the stories of how life could have been for people who lost their lives in accidents.

Other car insurance providers such as State Farm, Geico, Allstate, Farmers, and Automobile Club of Southern California also run commercials and campaigns to raise awareness about the dangers of distracted driving.

When motorists know their driving is being monitored, it pushes them to drive safely. Receiving discounts on auto insurance after safely driving for a certain period of time will further push them to proactively practice safe driving behavior.

Leading auto insurance providers such as State Farm, Progressive, and Allstate already have programs where they offer discounts to motorists if they agree to be monitored during driving.

If motorists are willing to work on their behavior, car insurance companies can encourage them to use apps that stop them from using smartphones while driving.

These days there are many apps that block texts and calls when you’re driving. In fact, these apps can even send notifications to callers that you’re driving.

Ending Distracted Driving is a Group Effort

Getting rid of distracted driving has to be a group effort where motorists, insurers, law enforcement, and lawmakers each take action to make the roads safer.

The importance of road safety should especially be communicated to teenagers who are new to driving since their lack of experience makes distracted driving even more dangerous.

The economic and human losses from distracted driving accidents are massive, and we need more actionable policies to keep a check on driving behavior.

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