Startup Fairmatic is building a business on discount insurance for commercial fleets using driver behavior data gathered through the drivers’ smartphones and the many sensors they employ to detect driver behaviors such as texting while driving or sudden braking.
The company recently raised $42 million in Series A funding led by Foundation Capital, which it will use for growth, including to help the company double its current level of 120,000 insured fleet drivers every year, said CEO Jonathan Matus
“We are the only company targeting the commercial fleet with AI and data,” Matus said in an interview with Fierce Electronics. The company is relying on 200 billion miles of crash and other road data gathered from vehicles over five years through Zendrive to build a strong AI-based risk model.
As a combined insurance and technology company, Fairmatic will rely on established US insurance providers who hold reserves to cover claims. Matus would not name those providers, but Fairmatic’s president of insurance is former Allstate President Jamie Trish.
Commercial fleet managers work with Fairmatic to install a Fairmatic app on driver smartphones where data from smartphone sensors is collected and analyzed at the edge. Privacy is protected and the app takes inputs from the phone about whether a driver is texting or talking on the phone while driving, as well as acceleration and braking. Accelerometers, GPS, gyroscopes and pressure sensors all provide sensing.
With the data, fleet managers can train drivers for better driving behaviors. “We never tell fleets to fire people,” Matus said. “It’s easy to understand problematic behaviors. If Monica is constantly texting while driving, a conversation with her might say part of her job is to be professional and represent the vehicle and the brand. We help but don’t dictate.”
With this approach, Fairmatic can expect fleets to reduce accidents and then offer an average savings of 20% on vehicle insurance. “It’s deeply satisfying for fleets to have that control,” Matus said.
Matus would not name any fleet customers for Fairmatic, but the company grew out of Zendrive, which has named customers on its web site including DSG Group, Credit Karma, MiWay, Ituran, and Undo.
Fairmatic has grown from five to 70 employees in the past year and faces the same difficulty in hiring programmers and engineers faced by other tech companies, Matus said. It runs research work in India, Israel and the US.
Aside from hiring challenges, the company faces the difficulty of explaining what Fairmatic does. “Because we’re so new, you need to wrap your head around it and it’s a task to explain what we do,” he said.
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