For anyone involved in mobility management – motor insurers, service providers, fleet managers, and so on – measuring and managing driver risk is crucial. That’s because a driver’s risk level is directly connected with crash probability and associated costs. But how can driver risk level be positively influenced, and just how effective are incentives in changing behaviors?
Incentives can take many forms and are commonplace in the business world to reward performance. Less common is their use to reward driving performance, but are companies missing out on a valuable opportunity to reduce crashes and safe money?
App-based driver safety programs are a great way to provide transparency to drivers about their performance and empower them to change their behaviors. With apps in particular, companies can provide real-time feedback after every trip, and utilize other gamification features such as leaderboards, challenges, badges, and rewards.
Companies the world over use incentives to influence behavior. And plenty of research has concluded that they work. According to one article posted on McKinsey & Company, “financial incentives, along with a well-crafted program of nonfinancial incentives, can create a higher level of energy and excitement across the organization and boost the discretionary efforts of employees.”
And, in a recently published “Incentives and Recognition” paper, the CIPD stated that “in general, employee recognition and non-financial rewards have a positive impact on intrinsic motivation and performance.”
Those involved in mobility management know how important it is to fully understand and measure driver risk. It helps to:
Additionally, for motor insurance companies, understanding and measuring driver risk enables accurate pricing and the development of entirely new, usage-based premiums.
By incorporating incentives and gamification into insurance policies, insurance providers encourage drivers to improve behaviors in exchange for premium discounts or other rewards.
Incentives that involve gamification have been shown to be successful. Kevin Werbach, considered an expert in gamification, has been quoted as saying, “Just knowing that this is something that makes you healthier doesn’t make you change your behavior but the gamified system does.” In describing a start-up’s experience of gamification, he explained that the most effective way to help employees be more fit was to put people in teams and challenge them in a game-like environment.
The same approach can be utilized in driver risk management to incentivize safer driving. The FIA Smart Driving Challenge (FIA SDC), a collaboration between The Fédération Internationale de l’Automobile and Greater Than, is a great example.
The FIA SDC app uses gamification to incentivize safe, eco-friendly driving. Features include:
At Greater Than we convert GPS data into crash probability and climate impact insights, providing the data you need to get started with an incentive program to reduce driver risk. With new layers of driver risk and climate impact intelligence you can identify the drivers in need of remediation as well as the drivers ready for reward.
We help our clients create solutions that incorporate incentives or gamification to influence safer driving. Examples include Covercube, who provide a transparent insurance product where customers can save money based on their risk level. Also Tryg Norway, who launched the Sidekick app to young drivers which offers deductibles for safe driving behavior.
All that’s needed to get started is 1km of GPS driving data, which can be shared with us via a simple API connection (connected car, telematics device, dashcam etc.).