Liberty Mutual, too, is finding value in telematics. The carrier unveiled in 2011 its  Onboard Advisor loss-prevention and risk-management services to small and medium-size fleets. The insurer uses statistics from its four approved telematics partners to create a score used for pricing at the time of renewal.

Onboard Advisor Program Manager Chris Carver says the service is a plus for clients, too: "Owners can stay in control of their fleet and control costs."

TWO-WAY STREET

Indeed, all insurers are quick to point out that telematics tools are not a one-way street of loss-cost benefits to the insurer; their use is about lowering costs for both parties.

The insured can help improve driver safety, fuel use, and prevent or limit losses from theft.

Fleet owners that "use telematics technology right will benefit," says Beth Lowrey, senior associate for Mercury Associates Inc., a Washington, D.C.-based fleet-management consulting firm. "They'll see it in their bottom line. And they'll see it in their insurance premiums."

The applications are numerous. Fleet owners acting as their own risk managers can track drivers' locations; monitor a driver's habits like hard-braking and accelerating; and reduce fuel consumption by looking at the data to identify trends such as the impact of idling or the use of one route versus another.

The value for insurers extends beyond potential reductions in loss-cost trends and improving risk selection. Telematics may also help preserve the exposure base. By cutting down on costs for its insureds, trucking businesses can remain profitable.

For the insurer, information also can be provided by some systems to provide a much more accurate view of an accident. Was the traffic light green or red? How fast was the driver going?

Insurers say information yielded from telematics systems can also help cut down on fraud. Using data on such critical factors as speed, claims professionals can determine whether an alleged injury was in fact possible.

BIG BROTHER BANISHED

The industry appears to have assuaged the fear of Big Brother—that is, that an onboard telematics-monitoring tool is an unwelcome intrusion into private space.

Owners and operators are taking to the idea, and insurers with telematics-based programs are sticking by buyers' sides to assist in rolling out systems. 

Lowrey says drivers' unions have voiced concerns as telematics gain popularity, but the fact is, "owners are looking at performance anyway," implying that drivers would still be watched closely regardless of the new technology.

STILL IN INFANCY, BUT HERE TO STAY

Industry-wide, telematics usage remains in its infancy. Definitive, favorable loss-cost trends for the industry are not yet readily available, and use is still mostly limited to the biggest insurance brands.

But according to a report by research and consulting firm Celent, telematics use is growing and "not going away any time soon," helped, in part, by steadily decreasing deployment costs.

Critics say telematics could "cannibalize" books of business, based on the idea that policies could be written at much lower premiums based on more hard data.

Yet that same data would also help better calculate risks, Celent adds, noting it "would be better to cannibalize one's own book than watch someone else do it."   

Anecdotally, Lowrey says she is without a doubt seeing greater attention being paid to on-board technology by carriers. 

"When I'm doing a risk assessment for an insurance company" on a commercial fleet, she says, "a lot of underwriters are looking for some kind of refined global positioning system."