Which systems help reduce your car insurance premium?

When shopping for car insurance, consumers look for adequate protection for the lowest premium. Did you know that insurers sometimes offer you a premium discount if your car has certain devices such as tracking systems? Which ones save the most money? Here are some pointers.

What is a tracking system?

A tracking system is a device installed on your vehicle to help locate it in case of theft. It’s not an anti-theft system, but it can be a good deterrent when its presence is indicated.

With the help of various data transmission technologies, tracking systems can, among other things, detect a vehicle that has been hidden inside a container or sent to another region. In some cases, these systems can even locate a vehicle that has had some parts removed.

A tracking system can take many forms. It can either be installed on the vehicle’s GPS navigation system, under the steering column, or plugged into the vehicle’s OBD port. Some systems are very discreet. They consist of a number of small transponders installed at key locations in the vehicle, such as under the seats, in the trunk, or within the engine compartment, for example.

Since insurers consider that this type of technology reduces the risk of theft and enables a stolen vehicle to be located more easily, they sometimes offer premium discounts for vehicles equipped with such a system.

Because thieves have upped their game significantly, some manufacturers are install this type of technology on their cars right at the factory. In that case, the insurer will generally not offer a discount, as the premium will already have been set based on the already-equipped vehicle.

What types of devices are recognized by insurers?

There are different types of vehicle tracking systems. The two most popular ones are GPS tracking systems—typically installed by car manufacturers at the factory—and radio frequency tracking systems, also known as RFID (radio frequency identification). The TAG tracking system is currently one of the most popular radio frequency tracking systems on the market.

GPS tracking systems have one or more transmitters hidden in the vehicle. However, these systems are more sensitive to jammers used by thieves to prevent tracking. In addition, some of these systems require you to call the control centre to activate the search, so the client ends up paying a recurring fee to stay connected to the control centre. GPS systems also often have limited tracking capability.

Radio frequency tracking systems are usually more effective because they have a number of wireless tracking devices throughout the vehicle that are difficult to pinpoint. Unlike some GPS systems, they can detect vehicles anywhere in North America and can even pick up signals from cars packed up in shipping containers.

How do tracking systems help reduce insurance premiums?

Because vehicle tracking systems are very efficient, insurers trust them to help prevent car theft. This technology has been proven effective in not only locating a vehicle after it has been stolen, but also finding it quickly before it gets dismantled or sent to another country.

How do tracking systems help reduce insurance premiums?

In some cases, vehicle tracking systems have even allowed authorities to identify major car theft operations.

Insurers believe that when a vehicle is equipped with this device, it is significantly less likely to be stolen. A lower level of risk allows the insurer to establish the right premium and terms for your insurance policy. However, it’s important to note that this might vary among insurers.

Are there any other ways to reduce your insurance premium?

Yes, there are other practical tips that could help reduce your car insurance premium. For example, some insurers may offer discounts if your vehicle is equipped with an anti-theft system or markings, or even a telematics system.

Using a mobile app installed on your smartphone, the telematics system analyzes your driving habits, which can be converted into a premium discount or product rewards. That’s also how Promutuel’s Appi application works. These systems are safe and are designed to provide you with an even more tailored client experience.

Please remember that you are required to update your insurance file should your situation change. Moved? Working from home? Disabled your tracking system? Take the time to talk to your damage insurance representative, as each risk assessment factor can affect your premium and maintenance of coverage. This will also ensure you’re well protected regardless of your situation.

There are a lot of practical tips that can help you further reduce your premium. Simply contact your damage insurance representative to discuss your situation. The more they know, the better they can tailor your coverage to your particular situation.