Do dash cameras lower insurance premiums? The short answer is yes for commercial auto policies, but only when combined with a vehicle telematics program.
This may be especially true in “no fault” states like New York, California and Michigan… This is because data suggests that certain no fault states have significantly higher levels of insurance fraud, or at least the appearance of claim abuse.1
Do Dash Cameras Lower Insurance In New York?
By themselves, dash cameras may not automatically lower your insurance premium in the U.S. (unlike anti-theft devices, airbags, or telematics systems)… However, when combined with a telematics system dash cameras lower insurance costs with many commercial insurance carriers.
Dash cams are relatively inexpensive, costing less than $200 for ones with GPS, multiple cameras and night vision.
A dash cam can also indirectly save you money on insurance in other ways, not directly tied to insurance premiums:
- Evidence in Accidents: A dash cam can help prove you weren’t at fault in a collision. This prevents wrongful liability claims, higher deductibles, and premium increases.
- Fraud Prevention: Insurance fraud is a huge problem in America, by some estimates equaling $40 billion per year. This causes an increase of $400-700 annually in higher premiums, per household. In staged accidents or false claims, footage can protect you by providing evidence that the accident was not your fault.2
- Driver Awareness: Dash cams, GPS tracking, sensors (such as gyroscopes for motion detection), accelerometers, speed detection and efficiency monitoring, voice recognition and recordings, etc. in vehicles increase driver awareness while on the road. This can lead to better behavior while driving, reducing the potential for accidents.
- Potential Discounts Abroad: In the U.K., Ireland, and parts of Asia, some insurers do give policy discounts if you use an approved dash cam. U.S. carriers may follow suit as adoption of telematics systems in vehicles grows.
For personal U.S. auto insurance, a dash cam won’t usually lower your premium directly. But it can protect your record (and future rate increases) by providing proof in disputes.
If you live in a “no fault” state, of which there are twelve (12) versus thirty eight (38 +DC) tort states, you may benefit from a telematics program for your commercial fleet because the potential incidence of fraud, or the appearance of fraud, is higher in certain states.
- No-Fault States (12): Higher exposure to staged-accident fraud.
- Tort States (38 + DC): Traditional liability, generally lower fraud risk.
- Fraud Hot-Spot States (CA, NY, FL): Where staged accident volumes are highest.
Telematics Making Commercial Auto Insurance More Affordable
If you’re running a commercial fleet, you already know how difficult it is to keep insurance costs down and find affordable commercial auto insurance.
However, when it comes to telematics, insurers may be more open to formal discounts. Businesses insuring multiple vehicles sometimes get premium reductions for using dash cams combined with telematics, because they lower risk across the fleet.
Before purchasing a dash camera or signing up for a telematics program, it’s important to know that commercial auto carriers may have telematics programs that they specifically recommend.
For instance, if you use Progressive auto, you may need to use their telematics program, not a 3rd party program, such as AT&T’s “Fleet Complete” program3, before the dash cameras lower insurance rates.
At the end of the day, buying a dash camera for your vehicle is your choice. Selecting a model should be determined by personal preferences, such as your budget or installation requirements.
However, certain features such as capturing videos in high definition, auto-recording after motion is detected, GPS tracking, dual camera angles or conveniently connecting your device to WiFi may be helpful in terms of providing evidence in the event of a crash that you do not believe was your fault.
Footnotes
- Auto insurance fraud is higher in no fault states because of how no fault state laws are structured. In "no fault" states, your insurer pays medical costs regardless of fault. Tort states make it harder because liability must be proven first before an insurer will pay.
- Some insurers appreciate dash cams because they reduce fraud costs, though few have formal discounts yet.
- I am not affiliated with AT&T's Fleet Complete program, I just mention it because I'm aware of this program for telematics.
