For decades, your car insurance premium was largely determined by demographic “buckets”: your age, your zip code, and your credit score. If you were a safe driver living in a high-density area, you were essentially subsidizing the risk of other, less-careful drivers in your demographic.

Telematics—often referred to as usage-based insurance (UBI)—changes this dynamic. By utilizing a smartphone app or a plug-in device to monitor your real-time driving habits, insurers can shift from “group risk” to “individualized risk.” If you drive safely, you are no longer a statistic; you are an asset. Here is how to master your driving score and leverage telematics to lower your premiums.

1. The Anatomy of a Driving Score

When you install a telematics app, it begins collecting data points the moment you start your engine. Understanding what the algorithm is looking for is the first step toward optimization.

• The “Big Five”: Most apps monitor