McDougall’s Telematic Program
McDougall Insurance can finally offer their clients auto insurance that is actually based on how they drive. Telematics has arrived in the form of Intact’s new my Driving Discount, and can be applied to auto insurance policies across Ontario.
As we’ve mentioned before, Telematics (or usage-based insurance) uses smart technology to monitor the way you drive. So with their my Driving Discount, Intact is watching how safe you are behind the wheel, and then rewarding you accordingly.
This can be a breath of fresh air for drivers who have spent decades feeling that the insurance industry applies auto insurance rates too broadly. With telematic programs it is no longer guaranteed that a young male will have to pay out the nose for his insurance – it is instead completely dependent on his ability to drive.
For now, Intact will only drop your premium with their telematic program – you won’t be punished, even if you drive like a maniac – and you get a 5% discount just for signing up. This discount grows to a maximum of 25%, based on how Intact evaluates you. This makes it a pretty attractive option for those who have their vehicles with Intact already.
What Does Intact Watch With Telematics?
The way Intact currently determines skill is pretty simple: they pay attention to rapid acceleration, harsh braking and the time of day that you drive.
Rapid acceleration and harsh braking are no-brainers. People who pound the gas or slam on the brakes are probably doing so because they are: driving aggressively, narrowly avoiding accidents, or both. Not exactly desirable driver behavior. Of course we all need to brake hard sometimes (it’s necessary to avoid accidents in some cases) and Intact gets that. They will only take issue with it become a theme, and not a rare occurrence.
The time of day criteria is also self-explanatory. In the early hours of the morning (defined as between 12:00-4:00am) there is reduced visibility. Additionally, the roads are made more dangerous by higher concentrations of impaired drivers (whether through alcohol, drugs or just drowsiness). If you don’t drive you vehicle during those times, you aren’t exposed to as much risk, and therefore don’t need to pay as much on your insurance.
Intact also monitors how much distance you drive and at what speed, but currently does not use that information to modify your rate.
Can I get Telematics?
To be eligible for Intact’s my Driving Discount, you need to have a policy with Intact Insurance. They are the largest insurance company in Canada, but are far from a monopoly. If you don’t have an Intact policy, but are interested in Telematics, you should ask your broker to explain your options. There may be a very good reason not to switch to Intact.
Additionally, you will need a vehicle with a diagnostic port (generally cars must be made in 1998 or later), and reliable Cell Phone coverage where you will be driving (that’s how the device works).
What’s the Catch?
There are a few slight drawbacks to entering a program like this, although McDougall Insurance still feels like it is an excellent option for their Intact policyholders. The first negative is that although you get a 5% discount immediately for entering the program, to get any further price reduction you need to wait a full year (specifically, the extra discount is applied when your policy renews, with an added condition that a minimum number of days pass between starting the program and your policy renewing). Intact does this so they can get an accurate idea of your driving – but it greatly delays what could be substantial (up to 25%) savings.
A second, famous, issue that is common across all telematic programs (and not just Intact’s) is privacy. For many people, having a device in your car which monitors what you do feels a little too “big brotherish” for their tastes. Intact does address this with a reassuring promise on privacy and confidentiality, but the concern is still there.
Finally, the discount-only approach Intact is applying to telematics may not be sustainable. Their program only makes sense if they reduce rates for good drivers while also increasing rates for bad drivers, otherwise they will lose more money than they gain.
Despite these (limited) issues, McDougall Insurance firmly believes the my Driving Discount can be an excellent way for Intact customers to save on their auto insurance. If you want to find out more about telematics, check out our blogs. And if you want a quote on an Intact telematic policy, use our online quoting service or give us a call at 1-800-361-0941. We’ll have you set up and saving in no time. And who doesn’t like that?