Personal auto carriers are quickly approaching a moment of truth when it comes to usage-based insurance programs where driver's behavior is monitored via a telematics device, claims a recent survey by Deloitte. Early adopters of UBI have gained a wealth of experience and insights that stand to provide a long-lasting competitive edge against insurers that have not followed technological trends.

Telematics trailblazers have been collecting massive amounts of data that can reveal driver behaviors, providing a basis for greater precision in underwriting and pricing, but these early adopters still face many challenges in executing a viable telematics program.

One of the main challenges is that widespread customer acceptance of these programs is far from certain, especially since there has been concern and skepticism regarding privacy, and some drivers question how much they will be scrutinized. Half of the current driving population, according to a 2014 survey by the Deloitte Center for Financial Services, is not open to the idea of a UBI—at least in the current market.