What is a Telematics System?

What are Telematics Systems?

The term telematics derives from telecommunications (communication via wired or digital technology) and informatics (processing data for retrieval or storage). In the 1960s, the U.S. Department of Defense created Global Positioning Technology (GPS), as an effort to help track assets and enhance military communications.

Telematics is a method of monitoring cars, trucks, equipment, and other assets by using GPS and on-board diagnostics (OBD). It is a computer within the vehicle that records information on speed, driving behaviors, tire pressure, fuel consumption, and more.

Common Components of a Telematics System

  • GPS Receiver
  • Sim Card
  • Accelerometer
  • Engine Interface
  • Input/Output Interface (Expander)
  • Buzzer

How does Telematics Work for Fleet?

Once installed in a vehicle, a telematic system tracks, sends, receives, and stores vehicle data such as trip distance, driving behavior, fuel consumption, vehicle fault codes, and more. This data is transferred to an interface or software for fleet managers to interpret. Telematics companies and OEMs require opt-ins to receive such data."

How Can Telematics Benefit Your Fleet?

Telematics can be used to help maintenance management, and fleet optimization (remote diagnostics, etc.). Here are some of the other benefits of vehicle telematics:

  • Increased productivity by automating many operational tasks for drivers and fleet managers (e.g., logging hours of service, vehicle leaving a user-defined area, and vehicle inspections)
  • Improved reporting and accounting of costs and expenses as telematics can help monitor fuel consumption, promptly identify vehicle issues that need to be addressed and log driving miles to most accurately compensate drivers for their time
  • Enhanced safety by monitoring drivers’ behaviors and alerts in case of accidents
  • Automatic and accurate odometer input that can be used to monitor timely maintenance, idle reduction
  • Idle reduction through driver alerts
  • Accurate measurement of downtime
  • Aids in theft recovery

Insurance companies may have options that reward good driving behavior, but this may not be an option if drivers exhibit risky behavior. Consider how opting in may affect your insurance rates either positively or negatively.

Also, consider possible privacy issues related to your data and driver location. Consult with your company’s legal department before agreeing to share data. Lastly, ask questions. Some organizations may be opted in without their consent.

Know all the options available to you before signing an agreement. Check with https://consumer.risk.lexisnexis.com/consumer and/or https://fcra.verisk.com/#/ to see if your data is being shared with insurance companies.

See the data your car can collect with this tool: https://vehicleprivacyreport.com/.

What’s Next?

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