Want To Save Big On Car Insurance? Get An Obnoxious Nanny

Bertel Schmitt
by Bertel Schmitt

In what “could herald a new era in auto insurance” (if the Wall Street Journal is right), Progressive “introduced a new type of car insurance that offers a discount to policyholders based on real-time information about how and when they drive.”

And how will Progressive obtain all that info? You guessed it, with a gizmo. Plugged into the OBD system, Snapshot “keeps track of your good driving habits,” as the particularly obnoxious Flo commercial promises. “In fact, Snapshot cares only about a few small things. Like how hard you brake, when you are on the road, the miles you drive.”

So what about bad driving habits? “Other stuff like how fast you drive or where you drive – it just doesn’t care about that,” promises Flo with the combined credence of Benedict Arnold, Pinocchio and Bernie Madoff.

Actually, “The only thing it cares about is saving you money.”

Ok, let’s add Richard Nixon.

The gizmo is part of Progressive’s “Pay As You Drive®” (yep, they trademarked that) program. It should be renamed to “Save While You Stop™”. Progressive offers snap-shot drivers discounts of up to 30 percent, if they brake gently, if they don’t drive during rush hour, and if they stay at home between midnight and 4am.

Basically, the less you drive, the more you save. Most likely you will achieve the full 30 percent savings when you don’t drive at all. Say hello to your car’s ankle bracelet. Oh, Progressive says the gizmo does not contain a GPS and won’t know how fast you go where. (Maybe speed does not kill. Or that feature is left for Snapshot 2.0)

“Other insurers—most notably Allstate Corp.—are working hard to catch up with their own usage-based insurance offerings,” threatens the Journal.

Progressive meanwhile is working on the next-gen Snapshot. Progressive Chief Executive Glenn Renwick told the Journal that in a few years, the gizmo will be obsolete. The data would be gathered from a customer’s cellphone instead.

In the meantime, let’s hope Progressive keeps the insufferable Flo commercials. They might be the biggest barrier to entry.

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Zackman Zackman on Mar 21, 2011

    Guess who will be ultimately designing cars in the near future? Many years ago (1972), the USDOT came up with their version of a "safe" car. It looked oddly like a 1980 Crown Vic, only squarer and heavier, no style at all and a periscope for rear visibility! We're on our way!

  • Jerome10 Jerome10 on Mar 21, 2011

    I have to say, I'm actually intrigued by this device. I love to drive. I love to drive quick. I have never been involved in even a fender bender. I have about the lowest possible rates I think I can have for someone my age, with my car (GTI), etc. On one hand, I don't like the idea that they would know some of my driving habits. Yes, I like to hit the gas hard, rip to redline sometimes. Does that affect the decision? They may think it means I'm unsafe, is that true? ABS kicking in is another. I live in Idaho. It snows a lot. You slide. ABS, stability come on frequently in winter. How does that work? I also saw an article this past weekend saying it WOULD keep track of how often a driver passes 80mph. This post says it wouldn't. Which is correct? And even if I do hit 80mph (I usually cruise about that speed in a 70mph zone) what is the problem here? Some parts (not enough, IMHO) of America that is the speed limit. How do they know I'm not in Texas or Utah? On the flip, if it is more accurate, then I think why not? If it saves money, plus currently they're just guessing what type of driver I am. Oh, he's 30, he has a GTI, he's single, his credit score is XYZ....could all be COMPLETELY wrong. But I'm charged for fitting a profile I may not actually fit. so in some way, I could see this as actually more fair than the current system. So I'm stuck. I'm very tempted. I could always try it and go back if I don't like it. But there are too many questions I think. What EXACTLY do they monitor? How does this thing work, legally, if I am involved in an accident? Could save $100 a year on insurance only to find the stupid thing makes me instantly guilty in a court should something happen, and I'm on the hook for something far more expensive. Can they share the data with others? Etc.

    • Telanon Telanon on Mar 21, 2011

      You can find answers to nearly all of your questions on Progressive's site here: http://www.progressive.com/auto/snapshot-common-questions.aspx . The one that you won't find there is the reference to driving over 80 mph that you mentioned seeing in another article. If you check, I think you'll find that was in the description of Allstate's product named Drive Wise(SM), not about Snapshot. Progressive did take high speeds into account in an earlier field-trial version, but say they do not in the current product Snapshot. They capture speed in order to calculate deceleration (see below) which goes into their discount calculation, but speed itself does not affect the discounts. They say their discounts take into account three things about how the vehicle is driven (they don't know or care who is driving): 1) miles driven; 2) day and time of day driving takes place: and 3) frequency of "hard braking", which they define as a drop in speed of 7 miles per hour or more in one second. They use the hard-braking frequency as an indicator of aggressive driving. They consider some number of hard-braking events each month to be normal, so avoiding an accident by braking hard won't effect the rate unless that happens too frequently.

  • 3-On-The-Tree Lou_BCsame here I grew up on 2-stroke dirt bikes had a 1985 Yamaha IT200 2-strokes then a 1977 Suzuki GT750 2-stroke 750 streetike fast forward to 2002 as a young flight school Lieutenant I bought a 2002 suzuki Hayabusa 1300 up in Huntsville Alabama. Still have that bike.
  • Milton Rented one for about a month. Very solid EV. Not as fun as my Polestar, but for a go to family car, solid. Practical EV ownership is only made possible with a home charger.
  • J Love mine, but the steering wheel blocks dashboard a bit, can't see turn signals nor headlights icons. They could use the upper corners of the screen for the turn signals. Mileage is much lower than shown too, disappointing
  • Aja8888 NO!
  • OrpheusSail I once did. My first four cars were American made, and through an odd set of circumstances surrounding a divorce, I wound up with a '95 Nissan Maxima which was fourteen years old and had about 150,000 miles on it.It was drove better, had an amazing engine, and was more reliable than any of my American cars. This included a new '95 GMC pickup that went through five alternators in under two years while the dealership insisted that there was no underlying electrical problem while they tried to run the clock on the warranty.That was the end of 'buy American'. I've bought from Honda and VW since, and I'll consider just about anything except American now.