Can a new insurance app cut down on claims?

A major car insurance firm is rolling out its newest product, a smartphone app that acts as a telematics device, and some have wondered if this could help reduce injury claims.

Aviva’s new Android app, available for free, will keep track of your motoring habits whilst behind the wheel, transmitting data to the insurer and offering you a discount for good driving. Originally put forward as a way to reduce insurance costs for consumers, if the smartphone app is widely adopted, the nation’s roads may suddenly get much safer as motorists mind their manners.

A concerted effort on the part of drivers to be more responsible on the road will undoubtedly lead to less road traffic accidents. This will of course have a knock-on effect of reducing the number of personal injury claims that are made, which could in turn reduce insurers’ costs even more.

And insurers definitely need some respite, as whiplash claims alone cost the injury some £2 billion in settlement fees last year, driving up premium prices as insurance providers scramble to keep up with crippling legal costs. More careful motorists could drive these claims figures down significantly, leading to insurers to actually begin making a profit once more.

The fact that the new service is available for free as a downloadable app is predicted to increase its popularity as well, as most telematics schemes put forward by insurers have necessitated the fitting of a separate ‘black box’ device under the bonnet. These devices can cost as much as £100 – a far cry from a free Android app – and may have been preventing market saturation.

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