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Half of drivers OK with being monitored

Usage-based coverage offers discounts for safe driving. But are you willing to have your habits monitored?

By Smart Spending Editor Aug 21, 2013 6:34PM
This post is by Des Toups at partner site CarInsurance.com.

MSN Money PartnerHalf of consumers would let their car insurance company monitor their driving for a discount of 10%, a new survey finds, and more than a third would even switch carriers for the opportunity.

Image: Car side mirror © Adam Gault, Digital Vision, Getty ImagesThe survey of 2,072 insured drivers by analytics provider LexisNexis Risk Solutions finds increasing acceptance of technology to cut the cost of car insurance.

Usage-based coverage, sometimes called telematics, offers the prospect of discounts for people who drive fewer miles, at the safest times of the day, or demonstrate extreme caution behind the wheel. That information is typically gathered by devices that plug into the car’s onboard diagnostics system and transmit data back to the insurance company. By far the most widely recognized system is Progressive’s Snapshot, though most major national insurance companies have a program of their own.

In fact, the survey found, more consumers were less comfortable with online banking (51%), search engines that collect their history (57%), or using social networking sites that maintain personal information (61%) than they were with the idea of idea sharing their driving data (48%) or GPS location with a car insurance company (40%).

While the survey indicates widespread willingness to consider telematics, only about 1.4 million drivers have tried Progressive’s program so far. Here are the top 10 factors surveyed consumers said would increase their interest in usage-based insurance:

1. 80% -- Ability to opt out without penalty
2. 79% -- Receiving a discount
3. 77% -- Choosing the information provided to insurer
4. 75% -- Control over what you pay
5. 69% -- Information saved for a short time
6. 69% -- Ability to view driving score
7. 69% -- Additional safety features
8. 65% -- Information on child’s driving
9. 64% -- Collecting accident data
10. 57% -- Maintenance alerts

Many of those puzzle pieces are already in place.

Some carriers offer a discount to drivers simply for enrolling, and all allow drivers to opt out of the program. Depending on the insurer, the discount could be based on mileage alone. Others delve deeper, with how hard you accelerate or brake affecting your eventual discount. Most programs allow drivers to see their data online. And Progressive offers a free trial to customers of other insurance companies.
But once enrolled, you can’t choose which data your insurer sees or control how long the data is stored. Currently, insurers say that data from their devices can be used only to reduce rates, not raise them.

The technology can go much further: State Farm recently patented a way to adjust rates based on the specific roads you drive, not just the ZIP code where you live.

Industry analyst ABIresearch predicts 89 million worldwide will adopt usage-based insurance by 2017.

That growth could be enabled partly by the emerging use of smartphones to gather and send data, especially in Europe -- which links the data to a specific driver rather than just to the car.  The LexisNexis survey found 73% of consumers viewed the idea of smartphone-based coverage as no more intimidating than programs involving a plug-in device.

More from CarInsurance.com:


24Comments
Aug 26, 2013 8:21AM
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My privacy and freedom are worth far more than a mere 10%.  They compile all these data bases of info on you and it will come back to bite you in the behind, and for what, a $100 per year....give me a break.  There are too many people that are willing to give up every freedom and every right for a nickel or the promise that they may be more safe.
Aug 26, 2013 7:36AM
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Slowly this government is using all of its resources to monitor your life.  Don't be caught up in this "improve your life" BS, stay as far away from the "Grid" as you can. 
Aug 26, 2013 5:45AM
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and  why may i ask  do they need   all of this information.  kind of like oboma  care  next they will want to monitor  your sex.  life  give me a break  some things in life  are my business when the people who sell me insurance  are  perfect  and can prove it to me  then  and only  then do i want them monitoring  my ever move if i accelerate to  fast  or  break to  much its  my business   i pay  for the  breaks  and  gas

Aug 26, 2013 9:54AM
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NO, absolutely not.  There are few enough places where we're not under surveillance or being tracked.  They can keep their fingers out of my driving. 
Aug 26, 2013 12:50PM
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There are good and valid reasons why even "innocent" people are advised to say nothing to the cops without having their lawyer present. Statements and facts (e.g., driving data) are easily misinterpreted, especially if the person perusing them has an agenda counter to your own best interests.

 

To preemptively lay bare your life in this manner voluntarily is, at best, foolhardy and will, at worst, work against you if your insurance carrier decides to deny your claim based say on a pattern of 'aggressive' braking. You don't think they can do that? When's the last time you read, really read, the fine print and all the clauses that are a part of your and ALL insurance policies.

 

Beyond that, any personal record you share with a third party (can you say metadata?), can be easily subpoenaed by any government agency or by opposing attorneys in a civil suit. Yeah, I may have to accept this blatant "1984" snooping in my life only when "Big Brother" is finally and fully in place (he's not here QUITE yet) but not until!

Aug 26, 2013 1:02PM
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This short-sided mentality is so typical of us in the US.  We try to save a frigging dollar and then wonder why our infrastructure is broken.  Case in point: Wal Mart.  Nothing wrong with Wal Mart but the cheap folks in the US practically HANDED China a foothold in the US, via Walmart.  Hey, Wal Mart is only giving us what we asked for:  CHEAP prices. 

 

But, that said, don't come back now and complain that everything is made in China!  We only get what we asked for.

 

And if you think allowing the insurance companies to monitor your private life for a savings of $100 is worth it, go ahead.  Just don't come back complaining when they call you and tell you they're dropping you because you do too many jack rabbit starts or other such nonsense.

 

 

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Chances are, if you give the insurance company your cell phone number they already ARE tracking you. Or, they can just call a subcontractor for the NSA to get your info...
Aug 26, 2013 5:51PM
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Wow...... another instant scan into my boring life..... Hell no, I am not okay with it! What is next an A_ _L PROBE I live with so the government can see what passes through my life?!?! I am not willing to give up my privacy so easy. I will pay more!
Aug 26, 2013 6:06PM
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Anyone who has a semi new car is already being monitored. The computer is just like a airplanes black box. It stores all data including speeding, hard breaking, fast acceleration etc and you cant erase it unless you have a very hard to get scanner. When you get in a accident your insurance company removes it and reads the memory, this is how they know you were speeding when you "said you were not"  The so called monitoring is from Teletrac, they are one of the biggest satellite tracking company's around. We use them in all out work vehicles, I can see where my technicians go, how fast they drive, I can even see when they turn the key to "on" not the "start" position. There mapping shows all locations they are or were at 24-7 you can not hide from this system unless you park under a bridge (shhh that's a secret)
Aug 26, 2013 5:37PM
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I want to drive the Insurance company nuts! After I insert the fob I will drive out to the next track day. Let's see what they do with the data then! Probably drop me as insured with a next day FedEx letter on the Monday after a race weekend.

And how many of us do this on a regular basis with our high performance sports cars? Lots of us. Plus in case you're thinking we are trying to get away with something, we don't. We already know that the insurance is void as soon as we enter the track. I just want to see the analysts faces when they try and figure out what is going on with all the acceleration and braking. The computer screen is goin bonkers.

Aug 26, 2013 11:15PM
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no, no, no, a thousand times, no.
Aug 27, 2013 12:35AM
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Warning.....warning.....warning.......if this idea of monitoring takes off, next it will be mandatory. Then if at any time you went 1 mile over the speed limit, your insurance will go up that month. It is a way for the insurance companies to "Adjust" your rates monthly. Tried to get a 1 year policy lately? They rather want to write a 6 month policy. They say that is because the rates may go down and you could get the cheaper rate in 6 months instead of 12 months. Bull.
Aug 26, 2013 10:52PM
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I drive like I'm on a quarter mile track so that would be horrible. I haven't gotten tickets or wrecks I just like to drive it like I stole it. My insurance would probably be $100,000 a year if they monitored me.
Aug 26, 2013 4:36PM
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This is a bunch of liberal drival designed to make people think that their ideolgical BS is actually accepted by the masses. People aren't that stupid. (Well maybe a democrat is)
Aug 26, 2013 6:01PM
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Wow, really? Almost all of you need to sit down and take a big breath.  Consumerism thrives off knowing what consumers want, right? We put ourselves out there every single day.  I have Progressive insurance, and, gasp, yes I plugged in the device to let them monitor my driving.  I saved some money.  Yay!  I'm totally ok with Progressive telling people I'm a good driver. 

 

The rest of you screaming the sky is falling, do me a favor, will ya: Go off the grid.

 

Cancel your telephone, cellphone, internet, and cable tv services.  Unlist your number from the phone book, but your old name is probably still out there so ya better-move to a different address, change your name, get plastic surgery (in another country of course), and cut all ties with anybody who just might know you-or the government will use the tiny fractal of meta data that's actually about you to take over the world.  Mwahahaha!

 

Seriously...Snowden did us a favor, but you all are nuts.

Aug 26, 2013 3:01PM
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This is not the government ! It's an insurance company and  if you are a reckless driver why should they insure you ?  This personal freedom thing is starting to be silly.  All the rest of us pay a higher rate so that wackos can drive carelessly, if those people can be deleted from coverage by my insurance company, thereby decreasing my rate, I'm all for it.
Aug 22, 2013 10:13AM
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I've used Progressive's system. It reduced my rate by quite a bit.

Progressive asked me to return the fob after about 6 months. They figured that they had established my driving patterns by then. However, the fob would beep at you if you accelerated too hard or you braked too hard. Sometimes I felt it was oversensitive, but on reflection, I think it would actually be better to have the fob permanently in the vehicle. The reason being that it provides instant feedback if you drive aggressively.

The Progressive system is only able to detect hard brakes, hard accelerations and driving from 12am to 4am (which is more dangerous, because people are a lot less alert and some number of them will be drunk). That's a little crude but it works. A smartphone based system, which has a GPS track for the car, would probably enable some finer-grained analysis of your driving. So I'd be open to that.
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