Why do People fit Tracking Devices to their Car for Insurance Purposes?

With the increase of car theft and hijackings in South Africa, it would be advisable to invest in a tracking device for your car. The National Crime Statistic released in September 2016 over a 12-month period showed that hijackings rose by 14.3%. That is a total of 14 602 hijackings per annum. 1Installing a tracking device will not only improve your car’s safety in an event of theft or hijacking, but it could possibly reduce your insurance premium quite drastically. In return, you will save some money in the long run.

What may be the impact on your car insurance?1

In some cases, fitting a tracking device to your car may not have an influence on your insurance premium, because of two factors.

1. High theft risk: if you are driving a high-theft-risk car, it may require you to install a tracking device in your car so that you can obtain insurance cover for theft or hijacking. Unfortunately, this may not affect your insurance premium, but at least your car will be covered for theft or hijacking.
2. Value of vehicle: a specific vehicle might not require a device but installing a tracking device may discount the theft portion of your insurance policy.

There are two different portions when it comes to your insurance policy, namely, the accident portion and theft portion. The cover on the accident portion is always more than the theft portion of your insurance policy. This could only change if the vehicle is more at risk of being stolen. In saying this, the tracking device might only have an effect or discount on the theft portion of your insurance.

Here’s what to do if you are considering a tracking device1

• Get into contact with your insurance company - some of them may offer a discount when installing your tracking device or you might get the installation for free.
• If you were to arrange the installation yourself, make sure to let your insurance company know. You might qualify for a possible price adjustment in your insurance premium.
• It is really advisable to put a tracking device in your car. Not only to protect or recover your car from theft, but it can lead to your insurer revising your insurance premium.
• When requesting for a possible adjustment in your insurance premium, just remember your insurance company will ask for the installation certificate to confirm that you have fitted your car with a reputable tracking device.

How do car tracking devices work? 2

Car tracking devices work with GPS (Global Positioning System) technology. A network of satellites are used to track the location of a specific vehicle or person to which the GPS device is attached. GPS technology has become very important in our daily lifestyle.

• What is a GPS tracker? It is a portable device that is fitted into a vehicle so that it can be tracked. Modern tracking devices provide real time information on a specific car. This data is captured and provides information like speed, location and driver behaviour through telematics technology.
• Who uses tracking devices? People use these devices if they are conscious of car theft or hijacking. Large fleet trucking or vehicle companies that want to monitor their vehicles or trucks also have trackers installed. Parents are also likely to use a GPS device to track their children when they are novices at driving.
• Why use a GPS device? A GPS device helps track your vehicle at all times, especially if you are afraid it might get stolen or hijacked. GPS technology also helps law enforcement and private car tracking companies to find and recover your vehicle easily.

Sources:

1. Does installing a tracker reduce your insurance premium?
2. How do GPS trackers work?
3. Disclaimer