Study: Insurance Incentives with Devices Reduce Speeding

The Insurance Institute for Highway Safety (IIHS) says speed-alert devices can be effective in reducing speeding when combined with coverage incentives.

In its November newsletter, IIHS highlighted several studies involving the technology, called intelligent speed adaptation (ISA), which in some cases uses GPS to locate a vehicle, gets speed limit data for the area its being driven in and notifies the driver in a range of ways if he or she exceeds the speed limit.

Most ISA systems employ visual or audible alerts about speeding. Other types of ISA systems use “haptic alerts” that harden the accelerator and makes it more difficult for a motorist to depress the pedal, while intervention systems automatically decelerate cars by reducing engine throttle, according to the IIHS.

Commercial vehicles often use speed-limiting devices, sometimes called governors, which cap a car’s speed at a predetermined level. ISAs, however, can be shut off. They also give drivers more control by allowing them to set the speed limit that will activate alerts.

In the U.S. and Europe, ISA systems have yet to be “deployed on a large scale on private vehicles,” according to the IIHS newsletter.

Studies Point to Benefits

Even without full-scale use, ISA studies have shown that they can be especially effective when combined with insurance-related incentives.

A Denmark study from Aalborg University and Copenhagen University found in a two-year trial that ISA systems and insurance discounts could reduce speeding.

In the study, drivers traveled above the speed limit 13 percent of the time with no advisories. But after they began driving cars with ISAs and linked having fewer speed notifications to getting an insurance discount, the subjects dropped their speeding rate down to 4 percent of the time.

A collaboration between the National Highway Traffic Safety Administration (NHTSA), Old Dominion University and Western Michigan University found similar results. The study’s 50 participating motorists included 40 whose cars were equipped with ISA systems; some of those 40 were paid up to $25 to keep within 4 mph within the speed limit and lost money if they sped.

The remaining 10 drivers participating in the study did not have any alerts or cash incentives.

The motorists who had both alerts and incentives hardly ever drove 9 mph or more above the speed limit, doing so less than 1 percent of the time.

Drivers who had no warnings or incentives, in addition to those who had only warnings, sped over the limit 9 mph or more as much as 9 percent of the time.

“The findings have implications for the use of intelligent speed adaptation systems in conjunction with insurance premiums to significantly improve traffic safety,” according to the report.

But despite their possible effectiveness, ISA systems are “still on the sidelines,” according to the latest IIHS newsletter.

The National Transportation Safety Board (NTSB) recently released its “Most Wanted” list, noting that collision-avoidance technology should be federally mandated in vehicles, but the list did not include speed-alert devices like ISA.

Speeding’s Impact on Insurance

An OnlineAutoInsurance.com analysis of insurance quotes from 23 auto insurers in Texas found that speeding tickets can have a harsh impact on coverage rates.

Using a sample profile of an under-25, single male Austin resident, OAI found that that driver would see his quotes increase an average of $198.65, or nearly 11.5 percent, after a speeding ticket.

What may have been one of the cheapest car insurance companies available before a violation could be one of the most expensive afterward. However, the effect of a speeding ticket ranged widely depending on the insurer.

The analysis found that the highest increase to a quote was $602 and the lowest was $11.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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