Using your phone while you’re driving can be dangerous and potentially deadly. If that isn’t common sense, there are plenty of studies and anecdotes to back that up (a recent study found that distracted driving contributes to a majority of car accidents). But what if you could use your phone — and, more specifically, an app — to become a better driver?
That might sound counterintuitive on the surface, but insurance companies are starting to buy into that thesis, thanks to TrueMotion, a Boston-based startup that counts former Zipcar CEO Scott Griffith as a co-founder and its chairman. Combing a smartphone’s accelerometer, gyroscope and other sensors with data science, the startup’s apps can determine things like whether you’re using your phone, driving too fast or making erratic stops. The apps then give you advice on how to drive better. In the case of one of its apps, TrueMotion Mojo, you can even get rewards like Amazon gift cards.
But while TrueMotion has consumer apps available for anyone to download, the startup’s bigger play is through its partnerships with insurance companies and other kinds of organizations that need to manage the risk pool of their drivers. The potential benefit for drivers here is the opportunity to save money on insurance premiums, though it also opens up the possibility of insurers charging bad drivers higher premiums.
“To me, this was a great mission to figure out how to use technology to make roads safer.”
TrueMotion’s technology is part of a broader trend in the auto insurance world called “usage-based insurance,” where insurers take into account things like mileage and driving behavior to determine premium rates. Roughly 70 percent of all auto insurance carriers are expected to use devices to track driving behavior by 2020, according to an SMA Research survey from 2012. Another local player in space is Cambridge Mobile Telematics.
Over the past 18 months, TrueMotion has partnered with 10 insurance companies that are using its technology, and the company said it is undergoing active trials with several more carriers, some of which will be announced in the coming months. The four partners it has publicly announced so far are Progressive, American Family, MetLife and, most recently, Travelers. In its partnership with Travelers, for example, TrueMotion’s tech will power the insurance company’s IntelliDrive smartphone app, which customers can use to save up to 20 percent on their policies and receive feedback on how to be a safer driver.
What has helped convince these insurers is TrueMotion’s ability so far to encourage better driver behavior. In the first three months of 2017, TrueMotion found that 27,000 drivers on its system reduced distracted driving by 20 percent per trip after logging 68 million miles.
To help it further expand within the insurance space, TrueMotion hired industry veteran Ted Gramer earlier this year as its new CEO. Gramer was most recently managing director at Solera, which sells software to insurance companies. Before, he was at Liberty Mutual for 14 years, ending his tenure there as an executive vice president.
“To me, this was a great mission to figure out how to use technology to make roads safer,” said Gramer, who was Liberty Mutual’s chief claims officer for several years.
By giving the auto insurers the ability to charge higher or lower premiums based on driving behaviors, TrueMotion will likely face a big question from consumers: is the technology accurate? To ensure that TrueMotion is accurate, Gramer said the company compares its apps with in-vehicle hardware, and it also receives driver behavior data from large numbers of users to validate that its algorithms are making correct predictions. The company also accounts for older smartphone models that have less functionality by modifying the algorithms of its apps with every new product release.
“Accuracy is of paramount importance to TrueMotion and the insurers and drivers who use our technology,” Gramer said.
While the insurance industry is TrueMotion’s current focus, Gramer said the company plans to eventually expand its technologies to other fields, including fleet management.
“Fleet management is one example where we have pilots underway to help businesses understand where vehicles are and how to make employees safer with more restrictions on phone usage while operating equipment,” he said.
“We’ve got pretty aggressive plans to build this into a big player.”
The company is also working on expanding the functionality of its technology, including a new feature that automatically calls 911 and starts the insurance claims process if the app detects that your car has crashed. Gramer said TrueMotion is currently working with several customers to develop this kind of functionality, but he said the biggest hurdle in doing so is the lack of accident scene data. The company has already been testing the crash detection feature in live crash tests with engineering firm Calspan, and it has already been verified against nearly 1 million miles of actual driving data.
While TrueMotion has consumer-facing apps that currently attract around 10,000 users per month, Gramer said their real purpose is to test functionality with drivers and give insurers an easy way to demo its products. The real play for TrueMotion is to turn it into a big enterprise player that sells into auto-adjacent industries.
“We’ve got pretty aggressive plans to build this into a big player,” he said.