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California's Revised Pay-As-You-Drive Insurance Draws Continued Objections
The EFF has restated many of their original privacy objections about California's latest revision to the Pay-As-You-Drive auto insurance proposal. Admitting that the amended bill is an improvement, privacy advocates are still uneasy about the surveillance implications of this program. "The proposal centers on a simple idea: infrequent drivers are less of an insurance risk. By pricing policies according to the mileage driven, insurance companies can offer discounts to lower-risk infrequent drivers, and put an appropriate cost penalty on heavy drivers. The state estimates that 30% adoption of PAYD insurance nationwide would reduce miles driven by at least 10% among subscribers, and save 55 million tons of CO2 over the next ten years. The benefits of such a system could be quite dramatic, as California Insurance Commissioner Steve Poizner is sure to emphasize. Such insurance plans first became available in 2004, and are now available as a limited option in 30 US states from insurance companies like Progressive and Liberty Mutual."
How is someone who drives less better at driving? It would seem someone who drives less frequently is less practiced and would be a greater risk as compared to someone who is a regular driver. There must be some sort of bell curve where the people on the ends pay more.
This is my sig. There are many like it but this one is mine.
Why would anyone think that paying by the mile would reduce the amount I'm driving?
I don't go on long jaunts around the town just for the hell of it, I go because I need to get somewhere, or pick something up.
So pretty much what this would do is either be a savings for me--because it'd be less than my buffet style policy--or it'd be more expensive for me. I'm guessing that the majority of people, myself included, would fall into the latter category.
I currently have no clever signature witicism to add here.
just don't know how it can save "55 million tons of CO2 a year"....people who drive a little will continue to drive a little with this insurance or not.
I hate it when they fudge numbers and try to draw a causation out of it.
A chicken didn't lay an egg because there was a law passed that gave tax incentives to the chickens to lay eggs....
I hate it even more when politicians take credit for something that has nothing to do with anything.
Couldn't you say that a driver who drives less has less driver experience than somebody who drives more? Therefore the driver who drives less could be a higher risk?
I don't drive very often, but when I do drive, I always have a case of Dos Equis with me.
https://www.eff.org/https-everywhere
People that drive less are less of an insurance risk? Perhaps as the time driven approaches zero ... but I would think people that drive well are way less of an insurance risk. This assumes of course that they only need to pay out when at fault. Shouldn't this at least be weighted by some sort of driving test that evaluated real-world conditions?
but it lacks any practicality fo California.
All this will do is make insurance unaffordable to low income families that have toi drive due to the distance they must commute. Meaning more uninsured motorists.
They al ready take it into account some what, and that's enough.
This is just attempt to squeeze another dime out of people who must have this service.
Quite frankly, if the Government is going to mandate insurance, then it should also offer a base insurance program, at cost.
Just one that covers the minimum insurance levels. If you want more, then you can buy more from an insurance company.
The Kruger Dunning explains most post on
I'd always thought it would be a neat idea to roll auto insurance in at the gas pump. No more uninsured drivers, plus it would be an incentive to reduce driving. obviously LOTS of holes in the plan, but it would eliminate the big brother aspect of this proposal.
Insurance companies already charge more if you drive more; all of them that I know of ask how much you drive. I actually started to RTFA, but there's little to no explanation of what the "pay as you go" does, and as I don't live in California it's not likely to affect me unless it's adopted by other states.
Can anybody clarify for me?
Free Martian Whores!
Sunday drivers have got to be the most dangerous people on the road.
Someone who drives 100K miles a year is going to have a lot more miles between accidents than someone who does 5K.
I'll see your Constitution and raise you a Queen.
I would have no problem with this if people were actually given the choice of whether to sign up for a pay-as-you-drive plan, but as it stands, this hurts consumer choice without any real benefits. It is unlikely that people will really drive less, because they still need to get to their jobs and to stores that are miles away from their homes. If we want people to drive less, we should be investing in mass-transit systems which will help them do that, thereby increasing consumer choice rather than decreasing it.
I have decided that in light of our depleting ozone layer, that I will begin charging for everyone who is breathing my air. You see, it was only my great ancestor Muk'targ of the Great Cave who was in charge of all the sky. His Gods told him so. So therefore he has passed this great gift to me and me alone. So as of right now, the entire population of the Earth owes me for each breath of air they take. Now if you can't pay, that's okay too. Because I will use my new portal device to adapt the air you breathe so you only have to pay for what you use. Now if you happen to die because you don't pay, how could you expect this to be my problem? Oh and the rates will be raised very little. Maybe only 2000% per year.
The dangers of knowledge trigger emotional distress in human beings.
I can see health insurance companies adopting this logic:
People who frequently exercise are less of an insurance risk. By pricing policies according to the amount of physical activity a person gets, insurance companies can offer discounts to healthier people, and put an appropriate cost penalty on basement-dwelling nerds, obese people, and other physically-unfit people.
I dunno about others, but all of a sudden, I'd have an incentive to find the shortest router from point A to point B, even if that means city-streets instead of expressway. This means I'll be sitting in heavy traffic, clogging up the streets, taking longer to reach my destination, and probably causing more accidents and safety issues.
bah... you could run every car on earth 24/7 and it wouldn't do half the damage as the 2 real issues behind any climate change we may be seeing.
1. Big AgBusiness.. The crap we're allowing these mega corps to dump into the water, killing a key filter our planet uses for processing O2 and CO2, is a war crime w/o a war.
Big Agbusines pt 2 .. 7 football fields of old growth forest cut down every *day* in South America.
2. The acre after acre of tropical vegetation we've poured Agent Orange on in central and south america in the name of our 'war on drugs'.. Yes, lil timmy won't be able to get as much pot after school, but he'll need to take a boat to get home.
I have no issue with the people of our planet collectively tackling the issue of climate change. I do have an issue with making up fake boogy men and ignoring the real ones that only have better lobbyists on their side.
I guess it's true what they say: The shortest router isn't always the fastest router.
https://www.eff.org/https-everywhere
Is there some kind of petition I can sign to get this rolling?
You think insurance companies will lower prices for the average Joe with this? I think not. Their claim experience isn't going to change, and they need to charge X dollars to all customers combined so they make a profit. They're still going to need to charge X dollars, so what's going to happen? Heavy drivers will pay *more*, and everybody else will pay about the same as they are now. Bah!
ON DELETE CASCADE
I mean, it sorta makes sense... but then again it also doesn't.
First I would point out that someone who drives 20k miles a year for 5 years drives 100k miles. A person who drives 5 k miles a year only drives 25k miles. So essentially, the 20k miles driver has 75k miles more driving experience than the lower milliage driver....
I would expect that sort of difference to start to really add up.
That said, the point of insurance is to mitigate risk by spreading it over many individuals. While it makes some amount of sense to charge relatively higher risk people more, doesn't it, eventually, start to defeat the purpose when you keep looking for more and more ways to do that?
Of course, it mostly makes sense if you assume the higher prices for the more risky people actually means lower prices for the less risky, when I would bet the reality is that the only way low miliage drivers will "pay less" is that they will "pay less than the new surcharge on the high milliage drivers" and not in any way, "less than what they pay now"
Kind o flike here in MA where the insurance companies are given license to surcharge for "offenses" like "not having the registration paper in the car" (sure its an offence, but its still a valid registration with valid insurance.... how exactly is not having the paper itself in the car... which contains no infomration that a police officer can't look up from his car in under 20 seconds... is a problem for them)
or how they support "traffic safety cameras" which have been shown to increase accidents at intersections. Makes sense.... major accidents cost money. However, the massive number of tickets and minor fender benders those cameras generate are an absolute windfall for the insurance company when they can hit you with YEARS of surcharges.
-Steve
"I opened my eyes, and everything went dark again"
Guess my fingers just wanted to type that r on their own ;)
WTF? Am I missing something? Last time I got insurance for a vehicle (in California!), the guy writing the policy asked me how many miles I expect to drive per year. They have a number of mileage brackets that are used in the calculation of your premium. The more miles you drive in a year, the more money you pay. Back in the before time, I had a classic car that was a weekend ride. Insurance was cheap because it was classified as "pleasure use" and driven less than a thousand miles per year. I don't think I've ever had a situation where the estimated annual mileage wasn't used to calculate the premium.
I dunno about others, but all of a sudden, I'd have an incentive to find the shortest router from point A to point B, even if that means city-streets instead of expressway. This means I'll be sitting in heavy traffic, clogging up the streets, taking longer to reach my destination, and probably causing more accidents and safety issues.
Interesting. Perhaps we should base it on a combination of milage and total engine revolutions. I've always wanted an RevOdometer (or hours of operation meter) on cars anyway. That way you could tell if the used Crown Vic you're about to buy was used mostly on highway trips to and from Minnesota to Florida, or used as a taxi cab.
how do you measure the length of a router? is it the distance between the i/o ports or something?
weinersmith
I'm using Milemeter.com in Texas, it's billed by the mile. I'm paying about half of what I payed my previous company with same coverage.
But it only works people driving under 12k a year.
Indeed. The states already make you get your car inspected on a fairly regular basis, and doubly so for California emissions standards. Why not just track mileage readings there? Why all the GPS shenanigans?
The World Wide Web is dying. Soon, we shall have only the Internet.
Lucky you. Back when I had a long commute -- despite the fact that I took mass transit to my office (with a two-mile drive to the train station) my insurance company assumed I drove to my office each day. I provided train receipts, pictures of my odometer, etc... I offered to have their agent inspect my odometer in person... but to no avail. They based their rates on a 120-mile round trip despite the fact that I drove four miles daily.
I eventually switched insurance carriers, but I overpaid on my insurance for six months because those douchebags couldn't grok the idea that someone might take mass transit even when they own a car.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
and life insurance companies would charge the active people more as they walk/cycle more and ate therefore at a higher risk of getting run over by a vehicle...
What's the insurance on a router? And which model are you using? I could see one of those big 10k systems being road worthy, but puttering around on 2100 series, you sir are a brave man!
oogly boogly!
Except that we do know this to be true... its been proven in scientific studies. Do you have a study that shows driving more increases your risk for an accident?
let's just stick a gps chip in everybody's skull, make its location publicly available, and be done with the whole privacy thing. then we wouldn't have to spend so much time worrying about it.
weinersmith
I thought the point of insurance was to distribute risk and cost over a group for both the insurer and the driver so that no single individual would be overwhelmed from unexpected expenses. This plan reduces the risk and cost to the insurer but transfers cost from one group of drivers to another group of drivers. It's another step toward customizing insurance plans to a single person customized insurance plan--rendering insurance worthless for those at high risk, yet it's required by law. If one were to apply this to medical insurance in that those who use more pay more, there would be public outcry.
Camping on quad since 1996.
I agree. Odometer checks seem far less invasive, and cheaper, than GPS. Also, already illegal to tamper with, while I can think of all sorts of ways to interfere with GPS tracking.
Try living in Maine. You start writing "int maine(int, char**)" and similar things all over the place. Some you don't notice, like street names, since they're capitalized anyway.
I can't believe many people will violate federal law to commit fraud by unhooking their odometers. This is already illegal, and somehow the leasing companies are willing to trust the odometer readings, and there is a substantial financial penalty for exceeding lease mileage limits thus creating a large incentive for fraud. And if someone does lie about their odometer reading and has an accident, the insurance adjuster can report the milage to the company so they can verify the mileage.
Besides, I always figured that modern cars wouldn't operate well without a working speed sensor. If the odometer is so easy to bypass, then maybe this issue can be addressed through the car companies. It's already illegal to bypass the odometer, so the car may as well enforce that.
Just ask Linksys.
"But this one goes to 11!"
Except that we do know this to be true... its been proven in scientific studies. Do you have a study that shows driving more increases your risk for an accident?
I guess this is appeal to authority, but actuaries aren't generally known for their wild flights of fantasy. If Insurance companies are offering lower premiums for people who drive shorter distances then it's almost certainly because statistically they pay out less in claims to those drivers. Is there really some reason to suppose otherwise?
To summarise the summary of the summary: people are a problem. ~ h2g2
The annual estimates used by my current insurance provider seems to work well enough. And if that isn't proof enough, they could simply track my odometer readings when they do the emissions inspections or something.
Being an infrequent (and thus probably inexperienced) driver doesn't necessarily make you less of a risk. My car insurance is currently pretty dirt cheap ($400 / yr.) due to many factors (it's our only car, we're married and over 25, and our speeding and accident record has been clean for the past 5+ years). But we drive plenty, both for work and recreation... at least 15k / yr.
In fact, the one time I did get into an accident, it took two other morons acting in concert... one in front of me to stop at a green light, and one in a fully-loaded Mack behind me to stop not.
Anyway, I'm all in favor of using technology to improve things like traffic reporting and stuff like that, but I don't think insurance is one of the primary applications.
give everyone free auto insurance and increase gas taxes by enough to cover it.
The Federal Highway Administration is already suffering shortage of funds due to fewer vehicle miles driven. There's been talk of more toll roads, increasing the gas tax, etc.
As I see it, encouraging people to drive even less will further decrease the revenue collected for road repair- which could mean fewer repairs, more time between repairs, and/or an incentive to raise the gas tax or invent new "usage fees". This could end up increasing the total cost- even though you're paying less for insurance, you're paying more for gas, tolls, etc.
OK so assume CA mandates this and then follows up with mandating a law that requires every vehicle in CA to be fitted with some kind of GPS or similar tracking device:
1) What happens when the tracker in my car suffers some kind of *mysterious* electronic failure? Am I going to be fined?
2) Who is going to pay for the tracker and the installation?
3) What happens when a faulty tracker drains the battery? (Oddly enough I've seen this happen in a fleet vehicle)
4) How do I get the lucrative contract to maintain this massive tracking infrastructure system?!!
5) Anyone want to bet that this gizmo won't also be recording speed - insurance companies probably value that info more than distance. Betcha law enforcement will have de facto rights to query your gizmo right there on the spot when they pull you over - probably have a built in blue tooth so they don't even need to get out of the cruiser to write you up.
We're already paying per mile in the form of taxes on each gallon of gas we buy. They must be gearing up to address the revenue threat posed by the as-yet impractical plug-in hybrids. Crappy idea all around in my opinion.
If there was any kind of mass transit, I would take it vs. the 2 hours I spend behind the wheel each day. I'll go out on a limb and say I'd take it at the cost of an additional 30-60 minutes transit time; at least I could get stuff done on the bus/train and I bet I'd have lower blood pressure to boot.
Diesel DOES beat gasoline, so that's pretty much OK.
How about looking into the correlation between gallons of fuel used vs. dollar amount of damage done and basing rates on that? It would get around the city/highway issue, wouldn't penalize small cars, and would actually have a much greater effect on pollution (say what you will about AGW, pollution and vehicle emissions are a pretty serious health and ecology problem either way)
As far as privacy concerns... this doesn't need to be mandatory for private personal vehicles. If you're really concerned, then you don't have to report anything to your insurer and they will just assume you are in the top usage bracket (which would make it more expensive, but doing it any other way would just create a situation where heavy drivers don't report in order to save money) and you can pretend that ensures you greater privacy in some way. Commercial and government vehicles- including trucks, taxis, limos, patrol cars, maintenance vehicles, company cars and anything claimed as a business expense on your tax return- however, should have mandatory reporting. Businesses have very few rights, and privacy just isn't one of them.
Try not to take me more seriously than I take myself.
This driving close to home bit sounds dangerous!
As well as using more gasoline and causing more pollution. When you're stopped at a red light you get zero mpg. Unless you're in a hybrid, travelling down a street where there's a stop sign at every block could cause your 35 mpg car to get more like 5 mpg. If I go to the Walmart on the north side of town using Dirkson Drive, It's a shorter route, but as there are traffic lights and a 30-45 mph (varying) speed limit, I can use I-55 doing a legal 65 mph and get there faster, more safely, and using less gasoline.
Free Martian Whores!
Use number of trips, not miles -- just like when comparing whether airlines are safer than cars:
http://www.midtod.com/98autumn/airline.phtml
Seems like mileage might be a poor indicator for this (though part of a valid equation). Wouldn't a better system involve the number of 'instances' of driving? Or perhaps actual time spent driving? Are people who commute on a highway every day for an hour (like me) really more likely to have an accident overall? Seems like we'd at least average safer on a per mile basis. Also, since this would require robots to know more me my driving habits, we hates it.
Anther oppressive government plan to require people to pay for roads they use.
Falcon
Should there be a Law?
Plants only store carbon. If you want to offset carbon emissions you need to plant trees where there weren't trees before. And if the forest is ever cut down, all that carbon is released back into the atmosphere through burning or decomposition.
:x
The states already make you get your car inspected on a fairly regular basis
What states? "The States"? (As in the United States?) The 30 states that the insurance companies are offering the GPS service in? My state (Michigan) has no such requirement. Also, if they provided this is an actual GPS navigation unit (like a Garmin or Tomtom) then it would be a lot cooler, at least. New unit every year or two, or something.
What I am wondering is this: If the data shows that people with a certain age group that drive less than a certain number of miles per year have the highest accident and claim rate, would the insurance rates for that group go up? Will the politicians have the guts to counter the outcry from the AARP?
No, another oppressive government plan to increase the profits of insurance companies.
The (R) half of the aisle will vote for it because an insurance company lobbyist is saying "And as a fringe benefit, you can tell your constitutents you're huntin' terrists and pedophiles by datamining the driving habits of all your citizens! Nothing to hide, nothing to fear!"
The (D) half of the aisle will vote for it because the other insurance company lobbyist says "And as a fringe benefit, you can tell your constituents you're trying to get people to drive less. Fight global warming!"
The plan gets "bipartisan" support, because there's something in there for politicians of both wings of the Party to crow about.
Assume for the sake of argument that I think a reduction of CO2 emissions is important and a good idea (I do, basically) and that distance-based insurance premiums are a good idea (not sure).
Citing a reduction of CO2 emissions as a side effect of distance-based insurance premiums is still stupid and annoying. It's bad and they should feel bad for doing it. They are problems that make more sense to approach separately, since they have very little relation to one another.
You're trying to use a one size fits all excuse to criticise the government and in this case it doesn't fit.
You see, insurers employ very highly paid guys to work out your risk to them as an individual. If your driving history shows you to be low risk, that will be reflected in your premium - insurers want your business, but equally don't want to lose money by providing you with insurance.
I can understand concerns about getting the privacy aspects sorted - why doesn't the state simply automatically report each year as part of your annual inspection? But the principle of using miles driven as an aid to calculating risk is one everyone with insurance already subscribes to.
Thanks to the interweb, shopping around for insurance is trivial. I myself have seen a 6 month premium reduced by over $1,000 through 20 minutes shopping around on the internet. As long as you still have plenty of insurers to choose from, you'll be able to find someone that offers a fair price for the risk you reflect.
All this proposal means is that every insurer will be required to factor in the risk the miles you drive presents, and I can't imagine a single insurer that doesn't already use the mileage you reported to them when taking out the policy as a risk factor.
Not all states have inspections. I know for a fact Florida got rid of them right before I started driving. Why? They were a hugely intrusive hassle ran by the tin-pot dictators at the FDOT.
I *really* don't think this would fly here at all.
There is a war going on for your mind.
What's the insurance on a router?
Salesman: About a buck fifty.
Duck: Put it on my bill!
https://www.eff.org/https-everywhere
Aren't we already charged based on estimated car usage? This article is about privacy objections and laws regarding monitoring miles, is it not?
I've always assumed the miles I enter when renewing my insurance went towards calculating the total premium. Actually, my insurer even told me so when I thought my rate went up - they said I was driving more.
If they wanted us to drive less, there are plenty of other ways to do it, rather than hacking our insurance. Idiots.
Shouldn't California be concerned for those growing central valley towns and cities like Tracy?
There are hordes of people commuting daily from central valley to silicon valley for work.
There would be even less incentive for people to move out there if PAYD was mandatory, which would cause the property values to drop even more than they have.
I'll go out on a limb here and also say that with the amount of miles these commuters drive daily, I bet you they have better intuition in how to drive well to avoid accidents vs. the occasional inner-city driver who drives twice a week to the grocery store...
MyRate by Progressive (as mentioned in the summary) has been around for quite some time (in select states) and I am a longtime customer. Here is how it works:
You get a computer chip that installs on the ODBCII port on your computer. Every 6 months (when you renu your policy), you pull out the chip, plug it into your computer via USB, and upload the data with your policy renewal request. You can view charts of your driving speeds, times, etc.
Progressive then offers you a discount percentage off of your base premium. They have an explicit policy that utilizing this chip cannot INCREASE your premium, only give you the option of a discount (in other words, we overprice our policy, but give you an option to recoup it if you drive less)
The discounts are as follows:
5% = participation discount
5% = safety discount (stay below 75mph and the discount is yours)
up to 10% = based on driving time / milage.
The 10% is calculated roughly as such.
At the beginning of the tracking period, you are given a 10% discount. then for every mile you drive, that percentage is reduced by a fraction. That fraction (something around 0.0006% per mile) is determined based on the time classification you drive. they have 3 classifications of driving time, low, medium, & high. High are times such as rush hour, and overnight, medium are weekends & lunch hour, low is everything else.
Ultimately, with both the safety discount and the amount I drive, I end up with somewhere around a 16% discount off my policy renewal.
It can be compared to the california policy, but in reality the current offered program seems quite different from the proposal.
I'm a consultant, I'm not out commuting every day of the week though I do drive a few times.
However, I like to go on long, multi-hundred mile road trips just like you. There's no consideration in this plan to say if I'm driving in a city or not, or even accounting for where I put the miles on at all.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
"I'm at far less risk than grandma"
that's a self selected bias.
"fault."
irrelevant. The more time on the road, the more likely you are to be in an accident, regardless of fault.
Of course, this is just ONE factor when determining premium prices.
The Kruger Dunning explains most post on
The premise is faulty. Open highway driving is far safer than inner-city rush hour traffic.
You need to consider the conditions, not just the distance.
-Jeff
Please learn the difference between a dissenting opinion and a troll before you moderate.
Many medical options already do, via incentives. My insurance company pays 20% of any gym membership I want to sign up for. I have a friend whose insurance company sponsored a contest for individuals reducing their blood pressure, and he ended up winning a high end exercise bike. They don't typically charge less, but they are actively increasing their "Value added" features to reduce the cost of claims.
Not all the Carbon is released as CO2 through burning or decomposition. A lot of it becomes soil and fertilizer.
Fly me to the moon Let me sing among those stars Let me see what spring is like On jupiter and mars
The insurance companies can, will, and do account for that. This stuff isn't hard to model. The basic idea is that you have a hazard rate per mile driven. More miles driven means more hazard. However, that hazard rate doesn't have to be the same for all drivers. The hazard rate they'll use to model your cost will be based on the experience of drivers in your same risk class, i.e. pretty low.
I am not a property/casualty actuary, but I am an actuary.
My only political goal is to see to it that no political party achieves its goals.
Seriously, whining about "low income families" everytime something useful gets proposed is getting a bit old. Won't somebody please think of the children!!
"All this will do is make insurance unaffordable to low income families"
Well then the low income families need to drive less. Actually everybody needs to drive less, regardless of income.
... That could save money and trouble: Insure the Driver, not the Car. In the State of Utah, if you (an individual, no family, etc) have 4 cars that are capable of being driven (registered, etc) you are REQUIRED by law to have insurance on each vehicle...so figure as cheap as you can per vehicle and times that by 4 or as expensive as you can imagine, and times that by 4... Why not figure the most expensive to insure vehicle that you own, and just charge you that much...then you could drive any other car you own, and it would be covered, because your insurance is geared to the most expensive to insure car... This makes sense because you can only drive one vehicle at a time. Then I could also drive other people's vehicles (no real special rider needed) because my insurance would be on ME and not on the car... Rental agencies do this to some degree... As for this idea...I don't see what the problem is. Each year you go in for Safety and Emissions inspections, just have the agency take the odometer reading and report back to the insurance company, who then figures the miles driven by a simple mathematical operation called "subtraction"...who then sends you a bill for the insurance on the miles driven (or an estimate of the miles you drive per year, making up the difference (to you or to them) in subsequent years...) How much more simple could it be?
--E--
One more reason to get on a bike. If you're not going to be going 100km/h anyway, you may as well do something that won't slow you down, won't cost you money, won't cause congestion or pollution, lets you park wherever you want, keeps you healthy...
"The biggest problem with communication is the illusion that it has taken place."
Maybe they will finally use this as an excuse to put a GPS monitor inside every car....
Lovely...
Tsukasa: All I really want, is to be left alone...
I've combed through the 108 comments so far that have been modded 2 or above, and not a single one of them shows any awareness of what the article actually talks about. Has anybody actually read the article? Oh, wait, this is slashdot...
The article helpfully explains that the main issue being raised by the EFF is privacy. Um, it's not exactly subtle...the article has a big image of a poster with a man's face, with the slogan "BIG BROTHER IS WATCHING YOU."
What the EFF is objecting to is the idea of using electronic monitoring to measure the number of miles driven. The article (remember that article thingie? it's got that little underlining thingie, with the text in a different color, so you can click on it, and it's, like, a hyperlink, so you can go and read it?) lays out some objections to this, such as the tendency the government has demonstrated since 9/11 to go nuts with intrusive monitoring of its citizens. The concern is that the government will then be able to tell where every citizen drives. That's pretty darn scary, if you think about it.
Find free books.
But this is the INSURANCE COMPANY charging you for INSURANCE. They don't care which is more efficient for fuel use, only which is likely to cause more accidents (of course, bigger engines are likely to cause more accidents than smaller ones... but that's why different cars have different premiums). Yes, this could have a positive effect on the environment, but it's also worth remembering that that's a side-effect in a for-profit insurance company.
If you want to penalise people for polluting, then increase the tax on gasoline. This really isn't rocket science.
"The biggest problem with communication is the illusion that it has taken place."
The proposed regulation states "Amend Title 10, Chapter 5, Subchapter 4.7, Section 2632.5 to read as follows:
Sec. 2632.5 Rating Factors
(a) Every insurer offering or issuing a policy of automobile insurance shall establish a class
plan for the calculation of rates that specifies rating factors in accordance with this section and
which complies with the good driver discount requirements of California Insurance Code Section
1861.02 and all other statutes providing discounts in automobile insurance rates and premiums."
Why the heck is the state micro-managing this? For that matter, why does the state mandate "good driver discounts"?
The state should perhaps set the mandatory minimum level of insurance per driver to drive on the public roads, and then leave it to the insurance marketplace to figure out how best to parcel out the risks (flat rate, GPS, good driver discounts, etc.)
This kind of state regulation and mandates is why health insurance costs so much!
If Insurance companies are offering lower premiums for people who drive shorter distances then it's almost certainly because statistically they pay out less in claims to those drivers. Is there really some reason to suppose otherwise?
But they also factor in age and experience (and other things). A newly licensed 18 year old that only drive 10 miles a week will still pay much more than an experienced 40 year old that drives 200 miles a week.
I already get a low-mileage discount on my auto insurance from State Farm ( 7,000 miles/year), and I imagine other insurance companies would have similar programs. So what's this bill proposing that insurance companies don't already do?
I use a ruler.
But per-mile, the expressway/freeway should be a lot safer than surface streets, so they should charge less for that. This is where fine-grained positional tracking would help the consumer's bottom line.
I knew a girl in high school who was a tremendous athlete. She played on the school's basketball team and come senior year all kinds of universities were knocking on her door to get her to play for them. However, the offers dramatically decreased when she blew out her knee and needed to get surgery. She probably got more exercise in one semester of high school than I did the whole four years, but also needed way more expensive medical care than I ever needed. My point is, even though exercise may prevent some health problems (eg problems related to being overweight like diabetes), people who exercise a lot are prone to injuries. Not to knock exercising, though, I'd much rather be an otherwise healthy person with a bad knee than someone who is dependent on insulin just to stay alive, but I'm not sure how effective that strategy would be at saving money.
... I found that the device did change my driving while it was installed. As I was reviewing the data that comes of it every couple of days, I would instinctively try to beat it. I would not accelerate and brake abruptly, speed, etc., which in turn lead to keeping longer distance between me and the vehicle in front and drive defensively. For the couple of months I was using it I was a safer driver. As a side effect my fuel economy was somewhat better.
So how is making me buy a tracking device in my car and the central tracking system going to save me money? Perhaps making every mile more expensive will get me to cut back some, but 10% is not going to be cut. Who is selling these tracking devices? Are they contributing to election campaigns? Are they going to be "FREE" ie I will pay for them in hight taxes? Will the logs of where your car has been be available for review and dispute. It could be fun to attach the tracker id of Ahnold to a city bus. If the logs are kept, can they be sold to advertisers? Will I get smut adverts because I cut through a bad section of town? Will the road taxes become flexible based on which route I take?
I smell more of the American PC correctness and stupidity here,
If you own a car, you need to get annual insurance, and expect to get it with No Claim Discount, as I live and do a lot of business in a country DE, with no speed limit, and the big BMW & Mercedes are limited at 260K (160 MPH) I go to a lot of trouble to make sure my car is in tip-top mechanical condition. I drive about 40,000k / year, I get 70% NCD, which I also insure, so I can sue Englander who drive into me in car parks.
So the whole basis of this proposal is nonsense, the more you drive, in a good car, quickly the better you get good at it.
I remember, nearly 30 years ago, pulling out of a motel in Maynard, MA well In front of a State Police car, whose driver took offence, but could not stay on the road at 50 MPH in thick snow and ice. When I stopped for breakfast, and he caught up, about 15 mins later, he tried to complain until I produced my fuhrerausweiss and explained we do that every day for 3 months each winter in mountains.
I only ask because the last two times I moved (to new places in the same city), my insurance went up because I changed zip codes. (At that point I became suspicious and switched companies which "reset" my insurance cost back to its proper level.)
I think there's a much higher probability that fine-grained tracking will result in the customer being penalized by the insurance company than that they will get a discount. If they're willing to increase my premium for moving to a new house, you can be certain they will increase your premium for minor speeding offenses.
Said it before, I'll say it again: I will NOT consent to tracking devices of ANY sort installed on ANY vehicle I own. Period. They can kiss my ass.
Are YOU using the TOOL, or is the TOOL using YOU? Think about it!
to make travel affordable, it should have more public transit.
While I'd like better public transportation, people in the US will not use it just because it's better. Many of those who own their own vehicles do not want to and will not give up their vehicles unless they have to. I've put less than 50,000 miles on the car I've owned almost 9 years yet I am not willing to depart with it. For me, I don't want to lose the freedom to jump in my car whenever and drive wherever so long as I can afford it. At the same tyme I'm not against raising fuel taxes, I've actually advocated raising them.
Falcon
Should there be a Law?
Insurance companies, just like electric companies as well as municipal water and sewer providers are still operating under the paradigm that existed in the early 20th century. That assumption is that the service they are providing, is either, for, or is, a luxury. At one time, driving was a luxury, at one time electricity was a luxury, at one time city water and sewer were luxuries. Until these providers enter into the 21st century with the rest of us and realize that these activities and services are necessities, you will keep seeing all kind of inane ideas as they try to make a buck.
I read Slashdot for the headlines, because the headlines, unlike the articles, are usually original and never duplicated
One of the key points is that driving the city streets causes more accidents than driving the freeway.
I really doubt that people will avoid freeways like the poster says, though. I think the extra gas used, the time wasted, and the additional risk of accidents outweigh the small advantage in insurance costs.
hands.
The answer is a shopping cart
Yea, like someone's going to get that shopping cart on a bus with it full of groceries.
There's also carsharing.
Carsharing is not that widely available or known about. I like the idea myself, for those who don't need or want vehicles much carsharing is terrific, but I am not willing to get rid of my car.
Falcon
Should there be a Law?
One of the key points is that driving the city streets causes more accidents than driving the freeway.
That sounds likely--but does it still hold when you normalise for seriousness of the accidents? Higher speeds ought to be much more injurious/deadly...?
"The biggest problem with communication is the illusion that it has taken place."
It's good to see that California isn't letting their impending bankruptcy hold back their socialist agenda.
I lived in LA for 6 years. California is probably one of the worst places to try to implement this program as: (1) they have a massive amount of urban sprawl, (2) Los Angeles has incredibly inefficient public transportation, (3) and there are broad swaths of the state where driving is almost a necessity for people who can't afford to live in the communities that they work in.
Is this really such a problem that is needs to be addressed right now? As others have said, there are going to be no deals here. Insurance companies will make sure that they profit over this little experiment. Furthermore, the state officials may mean well, but the federal government has shown that they will not hesitate to violate our privacy. Why give them another mechanism to do so?
But what really puts the cherry on the cake are the little comments that this will reduce CO2 emissions. Newsflash: Most people don't drive more than they need to, and the ones that drive for fun are just going to pay the tax and keep driving. Why does every method for reducing CO2 emissions have to involve punishing people while giving money to industry for absolutely no innovation? Do you think I like sitting in traffic with 3 other carpoolers? Build some efficient public transportation that actually works and people will take it. Reduce urban sprawl by not allowing people to build homes anywhere they feel like. Those are the techniques to reduce driving. Look at NY city. Look at all of Europe.
Must be your insurance company. Mine has never asked how much I drive.
This will depend on where you live and which insurance you have.
I've never been asked how many miles I'll be driving.
FAIL. My grandmother drives infrequently. She is not a low insurance risk.
Driving frequently increases exposure to risk, but it also reduces the risk along a separate curve. Someone who drives 40,000 miles a year tends to be a better driver than someone who only does 5,000 miles a year. Especially if the 40K driver has a record of being accident free.
Insurance companies are very much interested in looking for ways to profile drivers into high risk categories. What's next after having GPS devices?
- Variable rates based on how close you are to home? (Most accidents happen within 10 miles of home!)
- Variable rates based on what kind of road you are on (I like to ride my motorcycle in the Santa Cruz Mountains. Lots of accidents up happen up there.)
- Increased premiums for driving at night, or in the rain?
- Variable rates for the speed you drive at?
The big story is that the state of California wants to mandate pay-as-you-drive.
Where's your source? TFA doesn't say pay-as-you-go will be mandated.
Falcon
Should there be a Law?
Must be your insurance company.
I've had insurance through different insurers and they all asked for mileage.
Falcon
Should there be a Law?
People who frequently exercise are less of an insurance risk. By pricing policies according to the amount of physical activity a person gets, insurance companies can offer discounts to healthier people, and put an appropriate cost penalty on basement-dwelling nerds, obese people, and other physically-unfit people.
I wish. If only health insurance premiums were at least partially based on the life styles of the insured. The one problem I have with it is that insurance companies will want to monitor people.
Falcon
Should there be a Law?
I don't want to sound intemperate, but I'm getting sick and tired of stinking rotten lousy communist-bastard-leftist constantly assaulting my freedoms, fortune and sanity. There, I said it, and I can envision a scene from the movie Network, where millions of people sticks their head out of their windows and shout, "I'm mad as hell and not going to take it anymore!" Then, at that not-so-far-away point of terminal crazy fed-up, one or two terrible things can happen. In the first scenario, the pendulum swings, and stinking rotten lousy right-wing nuts take over. We lose. Or, in the second scenario, it's 1860 all over again, and we split in two, but with a pacifist socialist republic ruling the Northeast, northern Midwest, and West Coast, and the rest of us just happy to be rid of the other group remaining in a slightly less insane fly-over country. Both scenarios suck. But, I guess I'd better start looking at houses in fly-over country as a precaution. In the mean time, could someone please counsel California, and Washington DC while you're at it, to take a breath, and hold it. Keep holding it. No, keep holding it...
As a stinking rotten lousy communist-bastard-leftist, I resent that remark.
I think people are overreacting somewhat. Aside from the enforcement problem, pay-per-mile insurance is a wonderful idea. But you have to have an objective way of determining mileage, and the easiest way to do so is a real privacy-buster: install a GPS that can report your activities second by second.
But in principle, you should be able to create a device that can judge your distance based solely on the input from an accelerometer. It shouldn't need to record anything about where you are, when the acceleration happened, etc.
A complete recording of your daily whereabouts is a huge privacy intrusion. A quarterly report of total miles driven is hardly a concern at all. Such a device could easily be simulated by a GPS with no long-term memory.
Rather than kill a really good idea in the name of privacy, I think we ought to be insisting that the technology be the bare minimum to do the job.
You want the truthiness? You can't handle the truthiness!
There's a decent chance that a combination of both approaches is more efficient than either on its own, though. This would involve a fixed rate at the pump that provides a baseline level of insurance, plus compulsory supplementary coverage whose rate depends on the actuarial tables on age, record, car model, etc. The pump insurance might pay only up to a fixed amount per incident (or victim, perhaps?), and the rest of the coverage then would have to come from the supplementary policy. This way, a portion of the claims paid for each accident comes from taxes based on distance driven, and another from insurance rates based on the driver's record, car model, etc.
This is not to say that this is necessarily better than having insurers just check your odometer periodically; rather, the point is to remind us all that insurance schemes can be composed to produce different outcomes than each of them independently. It all comes down to whether the cost of the extra complexity is lower than the savings from the improved measurement and pricing of the risk factors.
Are you adequate?
well if you are going to mandate auto insurance( a stupid idea)then mandate it at the gas pump. Give safe drivers a rebate and those who self insure( commercial vehicles)a partial rebate. This coupled with no fault traffic laws for accidents under, say 10k in damage, and we would all pay half as much to insure our vehicles. Plus people who hardly drive or have multiple cars would not be punished. This has the added advantage of taking money away from insurance companies who are mostly evil anyway.
The only way to bust a doper--is when you yourself become a smoker!
How much does the auto insurance company have to pay for an accident resulting in death on a highway VS an accident resulting in minor injuries on a city street?
It occurs that if the insured died, they might have some difficulty getting the insurance company to pay much.
Ditto for the case where an accident involving the insured resulted in the death of another.
Historically insurance originated as part of the mercantile economy of the British Empire. A ship was an expensive thing, and the loss of a ship could ruin a middle class merchant. So they'd buy insurance--basically they'd pay a fee to a wealthy noble who would then gaurantee the value of the expedition--if the ship sank, they wouldn't lose anything. The amount they paid would be proportional to the risk of losing the ship, the value of the ship/cargo, and plus a margin of profit. Without that profit there'd have been no point for the nobleman to enter into the deal, and the state certainly wasn't about to assume to risk for the merchants.
You're leaving out Lloyd's, which was the most crucial link in the story.
Technically, the ship owner would approach Lloyd's of London, and they'd send a guy out to look at the ship and its crew. They'd then do some calculations based on the sailing date and expected weather, and come up with a price. The ship owner would pay the price, and Lloyd's would take a cut.
Lloyds THEN would turn around and sell all of the risk on the trip. They'd approach (as you say) a rich guy and offer to give him money in exchange for the rich guy to assume some or all of the risk on the trip, telling them the relevant details (good captain, but might run into storms, etc.)
In such a fashion, Lloyd's never had any risk at all, because they'd sell off all of the risk to others.
If the voyage did well, the rich guy(s) got to keep the money paid to them by Lloyd's, Lloyd's keeps their cut, and the ship owner has his ship. Everyone's happy. If the ship sinks, a well dressed gentleman from Lloyd's visits the rich guy(s) and tells them to pay up.
It still works that way today. If you're a wealthy Dubai tycoon, Lloyd's will happily pay you a nice sum of money to assume the risk on, say, an oil supertanker about to sail around the world.
How about penalizing the military for polluting? Do you have any idea how many fly overs i witness a day? If they were to spend the money on building simulators instead of burning fuel like it was going out of style I'm sure it too would have a pretty big effect on the environment.
With today's top notch flight sims there really isn't a reason why we couldn't do the majority of pilot training in the sims and cut down on all that wasted fuel. i would really love to see how much fuel the average airbase blows in a month on pilot training. if the constant flyovers by my home are any indication they are blowing through tons of the stuff.
ACs don't waste your time replying, your posts are never seen by me.
I believe tampering with the GPS tracking would be insurance fraud, which is also illegal. It's illegal either way.
I'll be sitting in heavy traffic, clogging up the streets, taking longer to reach my destination, and probably causing more accidents and safety issues.
This is an incentive?
The expressway is safe. You and you car are now at much higher risk - and your premiums skyrocket.
Your fuel costs go up.
Your maintenance costs go up.
The federal minimum wage rises to $6.55/hr on July 24. That's the minimum you lose for each hour wasted in your daily commute.
I was discussing this a few weeks ago with a pilot... He noted that this was already the way that insurance is charged for planes... Pay as you go based on hours and logbook. If you don't fly you don't pay (well you pay for theft and vandalism etc. that is separate.) The current insurance regime also penalizes people who want to have more than one car. E.g. get people to use a gas miser for commuting and save that SUV for carting the kids to soccer for the weekend.. If they can have ONLY one car they may end up with ONLY the SUV which is not good for the environment. Pay per use would allow you to optimize your mileage across multiple vehicles without having to pay the huge cost of insurance (with the current models) for both.
You're right that this won't necessarily have the intended consequences. Insurance costs of about $0.20/mile were one of the main reasons I stopped owning a car.
Due to expensive insurance, I switched purely to bicycle, walking, and rarely a taxi or public transit, reducing my carbon output.
No privacy concerns, far cheaper to administer, and within a couple of percent it will give you exactly the same outcome.
It's such an obvious and simple solution that I find myself siding with the tin-foil-hat brigade in thinking this is just another excuse for more control.
I'm sorry for being offtopic, but I don't know how to reach you except via a Slashdot comment.
I just wrote a brief article on climate change that quotes some of your insightful and helpful comments to me in the past.
I'm scared that this article will be filled up with rude people insulting me, or (MUCH worse) acolytes blindly believing in whatever I say. So if you see any mistakes in my reasoning or have any questions, please leave a comment at the form at the VERY bottom of the page. I'd like for the first couple of people who do that to be polite and capable of disagreeing agreeably. That's why I sent it to you first.
I guess this is appeal to authority, but actuaries aren't generally known for their wild flights of fantasy.
Except your wrong. Remember, they're a business trying to make money. They also push for laws which actually make driving less safe... lowering speed limits, installing red light cameras, etc. These things (unexpectedly) raise accident rates, and civil engineers who have no stake in red light camera vs. longer yellow light time say it, but oddly the Insurance Institute for Highway Safety (funded by insurance companies) have "studies" that contradict those finding. You see, if accident rates actually went down, they couldn't justify higher premiums. They have a vested interest in making things "just dangrous enough," so to speak.
If Insurance companies are offering lower premiums for people who drive shorter distances then it's almost certainly because statistically they pay out less in claims to those drivers. Is there really some reason to suppose otherwise?
Who said they'd be offering lower rates for those driving less? If by "lower rates," you mean they raise the rates for people that drive an average number of miles or more, technically you're right. But I doubt rates would drop for those driving below some average. Besides, most accidents occur within a few miles of home (and no, that's not the majority of trips, otherwise urban spraw would not be a problem).. so why does miles driven really matter?
If you like, feel free to find an actual study (not funded by the IIHS) that says those that drive more are automatcially more of a risk.
Where does age factor into experience? Why is the 40 year old driving 200 miles and not the 18yr old? It may very well be the other way around. Also, where you live plays a part.. whos going to be the better driver? Someone commonly driving in both city and country traffic, or someone that spent the past 50 years driving on small country roads, some of which have only recently been paved?
Funny. I used to ride the train with Jim Cramer, back before he assumed the crazy "Mad Money" persona for his show. He wasn't hurting for cash when he still worked for GS.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
No the GPS is a bad idea. I can't tell you the number of times my GPS unit has told me I'm not on a road, that I'm off in some field or at the bottom of a lake or something else equally as stupid. I drive a Honda Fit. I stick to paved roads, no matter what my GPS unit would like me to believe where I am. And since I drive a Fit, I certainly wouldn't want my insurance company thinking that I'm driving in weird places and thus charging me more.
Stop Global Warming!
Just say no to irreversible processes!