5/13/2013 9:45 PM ET|
Will insurers pay you not to speed?
New monitoring technology is creating methods for increasing highway safety. That could lead to cheaper coverage for motorists.
Would you speed if you were paid not to?
That's the thrust of a study by the National Highway Traffic Safety Administration (NHTSA) showing that motorists followed speed limits when offered financial perks.
The study, conducted by researchers from Old Dominion University in Virginia and Western Michigan University, focused on 50 people who drove cars equipped with GPS trackers designed to monitor speed. Drivers who didn't go over the limit received $25 each week.
But motorists who drove 5 to 8 mph too fast were penalized three cents each time. If they went 9 mph or more above the limit, the penalty doubled to six cents.
"This had a robust effect in getting drivers to reduce their speeding," says Ian Reagan, the study's lead researcher and now a senior researcher for the Insurance Institute for Highway Safety (IIHS). "Egregious speeding, driving 9 or more mph over the limit, was just about eliminated for those that had the incentive" not to speed.
Another new driver safety technology being tested
The study sheds more light on intelligent speed adaptation (ISA) systems that determine if someone is speeding by using GPS to link a vehicle's position to digital maps that include local speed limits. In addition to GPS, some newer systems also use cameras to read speed signs.
The ISAs, according to a recent report from the IIHS and the Highway Loss Data Institute, could warn drivers that they're going too fast or even automatically slow the car.
Typically, ISAs notify drivers of speeding using one of the following:
- An audible or visual alert telling the driver to slow down.
- A haptic alert via the accelerator that makes it increasingly more difficult for the driver to depress the pedal.
- Reducing engine throttle to automatically decelerate a vehicle.
Right now, ISA technology is being tested, but such systems are not yet in use in the United States.
Auto insurers advised to provide incentives
Insurers should consider rewarding policyholders if they obey speed limits, which would reduce traffic accidents, deaths and injuries, and the resulting auto claims and health coverage costs, says James Bliss, an Old Dominion University professor and one of the NHTSA study's key researchers.
It's too soon to tell if insurers would adopt such a plan, and if they did, how it would work. One option could be predetermined bonuses to drivers who don't speed, similar to Allstate's "Safe Driving Bonus Check" of up to 5% of premiums for every six months of accident-free driving.
Another option could be a discount on premiums, similar to the way pay-as-you-go, or usage-based insurance, policies work. While pay-as-you-go (PAYG) depends on drivers plugging a device into their cars to monitor performance, ISA technology in the future would likely be installed in new model cars as a standard crash-avoidance feature. Drivers would likely use either ISA technology or a usage-based system, but not both, because both monitor speed.
The pay-as-you-go roadmap
The study's results do seem to mirror the pay-as-you-go model, a hot trend in the auto insurance industry. Under PAYG, insurers give qualifying motorists premium discounts -- as much as 30% to 40% in some cases -- by installing devices in their cars that track driving habits and mileage. The safer and less you drive, the bigger the discount, according to insurers.
PAYG is clearly gaining traction, but it does have critics. Privacy advocates question how the information will be used, and some participants have complained that brake monitoring is too sensitive, reducing the amount of their promised discount.
Here's a look at what three of the major insurers offer:
- Progressive's Snapshot: The way it works is typical; you plug in the device, which then tracks time of day and vehicle speed, miles driven and how often you brake hard. Richard Hutchinson, the company's general manager of usage-based insurance, says savings could reach 30% for the most conscientious motorists. The device must be installed for at least 30 days to create a driving profile.
- State Farm's Drive Safe & Save and In-Drive: Drive Safe & Save requires an OnStar subscription. State Farm receives odometer readings from OnStar every 30 days and, after six months, adjusts your premium to reflect the mileage. The company says discounts usually range from 10% to 50%. The insurer also offers In-Drive, which requires a plug-in to track time of day and vehicle speed, miles driven and how often you brake hard. Discounts can reach 30%, according to State Farm.
- Allstate's Drive Wise: A plug-in device records the usual motoring statistics, which are used to determine if customers qualify for a 10% discount for the first policy term. If drivers maintain safe motoring habits and low mileage during subsequent terms, savings can go as high as 30%, the company says.
Other insurers with some version of PAYG include The Hartford, Travelers, Esurance, Safeco and GMAC Insurance.
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These incentives would be dangerous in rush hour traffic because they create backups and slow moving drivers.
Speed is not the problem. The problem is inattentive drivers who are eating, on phones/texting, and people who don't know how to drive.
The insurance companies know that people will not drive the speed limit when it is set artificially low so this is just another way to pad their bottom line. How many people know that insurance companies bought radar and laser guns for cities that couldn't afford them in the 1980s/90s because they were then able to raise insurance costs based on the speeding tickets
As long as the government, law enforcement, and insurance companies focus almost exclusively on those exceeding the post Speed Limit, then accidents and fatalities will NEVER be reduced.
It is the other traffic laws and codes that are not being enforced that cause almost all of the accidents, especially the Keep Right when applied to the center lanes on multiply lane highways.
This idea might be applicable and workable when the posted Speed Limits throughout the country are raised to a reasonable and safe margin, unlike today, when most are posted well BELOW the average safe speed of traffic.
Law enforcement also needs to be BANNED from accident investigations, as in almost every case the finding offense is "Speeding", even though the accident involved a DUI, failure to stop at a Stop sign or Red light, failure to Keep Right, failure to Yield, or an unlicensed driver, any of which should had been the main cause of accident, NOT speeding.
An independent office needs to established for investigating vehicle accidents that do NOT have a vested interest for the outcome to be Speeding, such as Law Enforcement, which receives more funds for overtime, promotions, and other resources, just to enforce speeding violations, which in most cases are FRIVOLOUS citations - especially when compared with the other violations most other motorists see while driving.
It's much easier to drive the speed limit without people who refuse to pass you tailgating you to go faster.
Also, very forcefully applying your brakes to avoid an accident is a very safe response and should not be an excuse to up your insurance rates.
I can see it now. Somebody tells the cop that they didn't brake to avoid the accident because they would have had to slam on the brakes which would have resulted in the machine reporting them and raising their insurance.
Speed limits are sometimes dumb and keep changing within few miles for no apparent reason. Especially, when highways are limited to 55, it is really stupid. when 99 percent of the cars are going way above speed limit then it is the issue with the limit and not speeding of the cars. But cities would not change these as it is a constant free flowing stream of revenue fish, they can catch as many and whenever.
I have issue with decreasing speed limits, increasing HP of the cars, better roads and more safer cars. it just does not make sense.
Also we forget that people calculate time and not distance to reach work from home when buying houses. if we decrease the speed limits then we reduce the distance people live away from work. that in turn reduces the spread of the cities, creates more densely populated cities, increases crime, reduces size of the homes, impedes growth, creates congestion and above all affects the economy negatively. The higher concentration and congestion further leads to reduced speeds and the cycle continues in a downward spiral.
Enough attention is already being given to speeding (traps, cameras, etc.). It's time to turn to cell phone use while driving, which can be more dangerous.
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