HOW TELEMATICS SHAPES THE FUTURE OF INSURANCE?

Telematics is transforming how insurers assess risk and interact with their customers. Instead of relying on fixed rates, many companies are now adopting behaviour-based models, where real driving data determines premiums. Thanks to advances in artificial intelligence and data analysis, this shift is accelerating across the world.

DATA-DRIVEN PREMIUMS

“The biggest changes in insurance telematics we see are the move from flat rate pricing to behaviour-based models. Accurate, tamper-proof data speeds up claim resolution and significantly reduces fraudulent or exaggerated cases. It protects insurers’ profitability and strengthens customer trust,” says Agnius Praniulis, product owner at Teltonika. “In some regions governments are introducing regulations that make driver monitoring mandatory. At the same time, AI integration makes it easier to analyse data, thus, this shift is only accelerating. Accurate, tamper-proof data speeds up claim resolution and significantly reduces fraudulent or exaggerated cases. It protects insurers’ profitability and strengthens customer trust,” Agnius adds.

To support the evolving market needs, Teltonika introduced FTx88 series – insurance-focused GPS trackers designed for reliability and simplicity. Devices include all necessary hardware and firmware features for usage-based insurance (UBI), such as trip tracking, eco-driving evaluation, speeding and idling detection, and crash reporting. What is more, trackers are battery-mounted, IP69K-rated, and highly power-efficient.  “For insurers, accuracy, reliability, and the ability to customise features are crucial,” Agnius notes. “We provide all required accessories directly from our manufacturing facilities and offer custom firmware development when needed. Also, our continuous technical support helps to ensure long-term performance.”

THE AMERICAS – PRIORITISING RELIABILITY AND EASY INSTALLATION

Driven by demand for plug-and-play solutions, the insurance telematics market continues to expand, in both South and North America. “Local companies are looking for GPS trackers that can be installed quickly without complex wiring or setup,” explains Gediminas Leknickas, continental development coordinator for Americas at Teltonika.

“The installation of a wired GPS tracker can cost up to 150 USD, so a simple process is crucial. Moreover, not everyone can connect the wires correctly and finding an experienced specialist can be difficult. With FTx88 series, companies can avoid additional spending and do not need an expert, as almost anyone can install these devices,” Gediminas explains.

Another important requirement for insurers is accurate odometer data. The ability to capture real OEM odometer readings is particularly valuable for pay-as-you-drive models, where mileage precision directly influences pricing. Although plug-and-play devices such as FTx88 series cannot read OEM data directly from the vehicle, their improved GNSS performance – with twice as many visible satellites – enables precise virtual odometer calculations. In practice, this provides mileage accuracy comparable to data read directly from the vehicle.

Eco-driving features such as monitoring harsh braking, acceleration, and idling are increasingly popular, enabling insurers to design reward-based programmes that promote safer driving. “Features offered by FTx880 trackers help insurers reduce claims and encourage responsible behaviour, and at the same time create loyalty among drivers who see real benefits from their safe habits,” Gediminas adds.

AUSTRALIA – EMERGING OPPORTUNITIES IN USAGE-BASED INSURANCE

Australia’s insurance-telematics sector is showing strong growth potential. “UBI adoption is rising rapidly, with some reports indicating nearly 25% growth,” says Letitia Gozman, regional marketing manager at Teltonika. “While the market is less mature than in the United States or Europe, insurers are actively exploring telematics solutions to differentiate their offerings and manage risks more effectively.”

This momentum comes at a critical time. Australia is facing a worsening road-safety situation, with more than 1,300 fatalities recorded in 2024 and an 18.5% rise in deaths since the launch of the National Road Safety Strategy 2021-2030. Many incidents involve young, inexperienced drivers, underlining the need for targeted, behaviour-focused measures.

According to Letitia, insurers also face unique structural challenges, including rising customer turnover and complex state-specific compulsory third-party insurance rules. At the same time, Australians are dealing with steep increases in premiums, which average around A$929 per policy but can reach several thousand dollars in major cities. Cost-of-living pressures have pushed many drivers to downgrade or cancel their cover, leaving a growing share of vehicles uninsured or underinsured.

“Telematics provides a strategic advantage by enabling personalised premiums that reward safe driving, helping reduce churn and improve satisfaction,” Letitia explains. It also supports wider affordability goals by improving risk differentiation, reducing high-severity claims and easing upward pressure on premiums over time.

Fraud prevention is another notable benefit. “By collecting precise crash data, GPS position and driver behaviour before an incident, insurers can reduce fraudulent claims and process legitimate ones faster,” she says. “This transparency benefits both insurers and customers.”

Looking ahead, Letitia sees opportunities beyond personal insurance. “Commercial fleets offer a natural entry point for telematics, allowing insurers to lower claims and enhance road safety at scale. However, the biggest growth potential lies in the consumer market, as awareness of UBI products increases and personalised risk assessment becomes standard practice.”

She concludes: “With reliable, feature-rich devices that integrate seamlessly into backend systems and enable real-time driver scoring, Teltonika is well positioned to support Australian insurers as they expand their telematics programmes.”