This Gizmo Will Rat On You, And People Love It
Privacy is highly valued – until we can sell it for a small discount. Hundreds of thousands of auto insurance customers allowed an electronic ankle bracelet fitted to their car in exchange for a possible insurance discount. A year ago, Progressive offered its “”Snapshot“ device. It plugs into your car’s OBD system keeps and collects data that help Progressive to profile your driving. According to Reuters, Progressive already analyzed more than 5 billion driven miles. The company says its driving-behavior data is twice as good as any other factor in predicting risk, and that bad drivers cost Progressive more than twice as much as good ones.
Other insurers likely will follow the example, the report says. What if you don’t let Progressive snoop on your driving habits? You won’t get the discount. And soon, you might be punished with higher rates.
“Whatever the math will say the rates will have to start going up on the rest of it,” said Robin Harbage, global marketing and sales leader for consultancy Tower Watson’s auto insurance practice. “It’s almost inevitable that the people who aren’t using will have to pay more because the people who are the best drivers are being self-selected into these programs.”
I recently got one of these with Allstate. It records the number of hard braking events, miles driven, time of day you drive, and number of miles driven at over 80mph. It also records hard acceleration events, but they don't count against you; at least for now. If it recorded hard cornering I would have passed on it, because I'd be getting flagged like crazy. So far I'm pleased with the device. Since April, I've recorded 2 events of "hard braking", 0 events of "extreme braking", and 0 miles over 80mph. On the other hand, I've recorded 48 events of "hard acceleration", and 13 events of "extreme acceleration", and this is not in a fast car (Mazda 3i). It doesn't count against me though, so it's academic for now. You can always opt out if you don't like it.
I went through their 6 month program of using these on three cars and I think it is positively brilliant of Progressive to do this. I drive safely and I've garnered two 30% discounts and a 23% discount. This was on top of an already competitive rate when I switched from another insurer. Anyone who spends 6 months driving carefully for the discount is not very likely to switch insurance without a compelling reason, and this is the brilliance of the system.
There is no guarantee that what they are measuring is truly safe driving in the circumstances you are in. High scores would be given for someone driving slowly in the passing lane & yet creating a hazard to others. In my hybrid, i would have to "floor" the gas pedal to get it to move after stopping on a hill. This is a poor way of judging good driving.
I also have a good driving record, focus far down the road in front of me while avoiding tunnel vision and as a result, seldom need to indulge in hard braking. And I'm sure the majority of drivers fall into this category. But based on what I've seen in cities that utilize red-light cameras, especially the speed-on-green variety, and especially when the length of yellow lights are shortened in a sleazy attempt to generate revenue (Hello Calgary, AB!) many of those same drivers now brake hard much more frequently than they used to. It's a situation in which municipalities and insurance companies can't lose. The province/state/city gets to steal gobs from the public while using the "think of the children!" excuse. (you know, the one that contains just enough truth to lend credibility to their b.s.). And the insurance companies get to spike the rates of all those drivers who rear-end the guy who slammed on his brakes for a 2-second yellow. Not to mention raising the rates of all those poor suckers who got ticketed for cruising through that yellow thinking it would last the normal three and a half seconds instead of only two, or simply for knowing instinctively that slamming on the brakes would result in getting slammed from behind by that transit bus. As for opting out of such a device as offered by Progressive, it's nice that we at least have this option. But be careful, because if all insurance companies agree among themselves to do this (a very real possibility if it proves profitable for Progressive) they may not violate our right to opt out per se. But they MIGHT very well make it so draconianly expensive to not opt in (or to drive older vehicles that aren't compatible) that most of us would have no choice but to comply.