NEW YORK—Telematics devices are helping to reduce accidents andremove unsafe drivers from commercial-auto fleets, but effectivelyincorporating all of the new data into underwriting is a processstill in its infancy, say insurance executives.

During the third annual Casualty Insights Conference sponsoredhere by Advisen on Monday, Executive Vice President, Casualty &Healthcare Divisions for Lexington Insurance Co., Brad Cox, saidthe electronic devices used to monitor and control driving activityare giving fleet operators and insurers the tools to reduceaccidents. For instance, trucking fleets using speed-regulatortechnology have seen collisions reduced by 50 percent compared tothose that don't.

Geofencing technology, which tracks vehicle location, is helpingto improve driving efficiency.

Kevin Finn, vice president, National Accounts, for The Hartford,said the adoption of telematics has been “less consistent”throughout the non-transportation industries. But those who haveused it see a “huge impact and become believers in thetechnology.”

A major challenge for insurers is tying the production of datato losses and using the information to validate loss trends over aperiod of time, said Erin Bellott, senior vice president andproduct line manager, automobile, for Liberty Mutual. She said theaccumulation of this data is in its infancy and the industry doesnot currently have the tools to incorporate the information intounderwriting utilizing long-term models. She said it will be fiveyears before the tools are available.

Craig Bollinger Sr., vice president of risk management for NFI,a trucking company, said he has come to use telematics technologyas a learning tool and driver of efficiency.

“Every penny we can save is tremendous,” he said.

Utilizing telematics, NFI addresses drivers after an incident,such as reviewing a driver's hard breaking that could cause a loadto shift. He said the review is very personal, explaining to thedriver how bad habits can not only cause an accident, but caninjure others including the driver himself. Telematics data alsoprovides NFI information to eliminate drivers that pose a safetyrisk. He said this approach has reduced the company's claims forover three successive years, and he expects even greater adoptionin the future.

“It's not a negative; it's not big brother when it is doneright,” said Bollinger. “But the problem is with all this data, howdo you sift through it and make it really impactful?”

Without a program in place to address and correct issues withdriver behavior, he said incorporating the data into underwritingwould not be effective.

“It is a big circle and you really have to follow this all theway through the process,” he said.

Correction: Kevin Finn, of the Hartford, said the adoptionof telematics was less consistent throughout the non-transportationindustry, not the trucking industry.