Insurance providers in some countries incentivise motorists who drive vehicles fitted with a dash cam. LIZETTE ERASMUS, Insurance Expert at IntegriSure, debates whether dash cams can play a bigger role in the local short term insurance industry.
Road accidents, some of which are fatal, are a regular occurrence on South African roads. Transport Minister Joe Maswanganyi released road death statistics showing a 51% increase in fatalities during the 2017 Easter period – raising concern for safe driving on the roads. The role of dash cams (or car dashboard cameras) in helping motorists with responsible driving has been much debated around the world.
Social media is littered with dash cam footage of road rage, irresponsible driving and bad accidents. With such availability of driver behaviour evidence, should dash cams play a bigger role in settling motor accident claims, determining premiums and be used as a tool to incentivise drivers in South Africa?
Unlike South Africa, insurance providers in some countries incentivise motorists who drive vehicles fitted with a dash cam. According to insurance companies in the UK, having a dash cam could reduce the premium by up to 15%.
Risk profiles depend on many factors
Being able to provide additional evidence that you were not at fault when a motor accident occurs can be beneficial during claim stage and even fast track the process. Many factors go into the process of determining a risk profile and therefore setting a premium. However, the willingness to install a dash cam for visual evidence in the event of a claim could indicate to insurance providers that one is a responsible person and consequently reflect in their premiums.
However, the bigger picture will always come into play. Your credit record, claims history, length of time you’ve had a driving license, as well as the security measurements taken, will influence the premium an insurance provider settles on for a specific client. Even if adopted, the installation of a dash cam will need to be evaluated in light of the other aspects of determining a risk profile.
Detecting fraudulent claims
Economic pressure unfortunately causes fraudulent behaviour and insurance providers have fallen prey to this type of behaviour.
Russia was one of the first countries to widely embrace the use of dash cams, mainly as a defence against police corruption, as well as insurance fraud such as ‘crash for cash’ scams. Crash for cash scams happen where fraudsters deliberately cause ‘accidents’ by running or driving into the road as soon as a car approaches, with the aim to claim for insurance.
To an extent, dash cams provide proof of foul play in the instance of this type of fraud. In addition, dash cams can help avoid the he-said she-said scenario at claim stage.
Dash cams assist with the collection of evidence, but do not eliminate the need for a thorough investigation into an incident. Dash cams see broadly into the road, therefore other detail on the road may be missed by the camera lens – which is where an eyewitness account is still vital. Insurance providers still have to conduct thorough investigation to assess the incident and the resultant damage. Dash cams do, however, assist in speeding up the process and giving a greater scope of what happened.
The unintended consequences of dash cam adoption
As with anything, insurance providers will have to contend with other unintended consequences when assessing the viability of adopting dash cams – one of which is a legal risk. While recording via a dash cam is not illegal, sharing such footage may be an infringement of people’s right to privacy. Dash cam footage is commonly shared on social media, which can be seen as violation of privacy, resulting in litigation. Insurance providers must consider the risk of being party to these types of cases when encouraging the use of dash cams, and appropriately educate consumers.
Dash cameras benefit motorists and vehicle owners
Most dash cams are linked to the engine and are therefore programmed to start recording as soon as the ignition starts which is also beneficial in ensuring the dash cam is always recording. This could very well be a prerequisite should the technology be adopted by insurance providers. For fleet owners, dash cams can help them monitor whether their drivers are driving responsibly or not.
A vehicle owner who lends a friend their vehicle is also able to monitor their friend’s driving behaviour through the dash cam footage. Furthermore, viewing footage of your own driving can help improve one’s own driving, as you can watch and review where you need to correct your driving behaviour.
The use of technologies such as telematics and tracking devices has been adopted by the South African short-term insurance industry, and dash cams could be another device to investigate to add to that list. When all is said and done, dash cams do encourage responsible driving behaviour. Whether or not South Africa is ready for the wholesale adoption of dash cams in the short-term insurance industry remains to be seen.